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Swine Grist

A PERIODIC NEWSLETTER PRODUCED BY FORTIFIED NUTRITION LTD. VOLUME 9, ISSUE 1 | SPRING 2022

Dear Friends, As we headed into April 2022, two years after the pandemic related restrictions began to impact many aspects of our lives, it was heartening to witness the lifting of restrictions province by province and seeing daily activities moving back towards some assemblance of pre-COVID normal. This being said, Agri-Business and the economy in general seems to be moving further and further afield from pre-pandemic norms. For the foreseeable future, gone are the days of cheap commodities, cheap fuel, cheap food and historically low interest rates. With all of the supply restrictions, interruptions and delays of many inputs in many industries, we have moved from “just in time” inventories to rapidly expanding “just in case” inventories with as much focus needed on order fulfilment as it is on cost of ingredients. Accordingly, this issue of the Grand Valley Swine Grist discusses the importance of feed efficiency and mindful feed budgeting (per pig), the ever-changing market for feed ingredients, the regulations surrounding them and ways to maximize farmgate revenue to offset expensive farm inputs. Truly harnessing on-farm technology and the data that comes from it will be a key driver of profitability as margins tighten in the days ahead. As discussed in previous Grand Valley Swine Grists, we have a growing list of data analytics tools like Profit Finder™ that over fifty swine producers across Canada are using to help maximize their hog shipment revenue. This is just one of our On Farm Business Intelligence tools that GVF has developed to help maximize the profitability of our customers operations. We trust that you will benefit from an idea or perspective that is shared in the articles below and allow one of our Swine Specialists or Nutritionists to discuss them further with you. Sincerely, Ian Ross, President & CEO

UNDERSTANDING PERFORMANCE OVER COST

by: VICTORIA SEIP Livestock Business Intelligence Manager, Grand Valley Fortifiers

s both the hog and commodity markets continue to show great volatility and variability, feed budgeting is extremely important to make sure we minimize feed cost and maximize performance of our animals. We continue to see rising feed prices, which has made us alter what we are feeding in order to maximize on ingredients and efficiency. Efficiency is key because as long as hogs are not backlogged, feed conversion is more important than ever. What I mean by this is the less feed we have to put into the animal, to achieve the best possible gain, the more we will save on the use of expensive commodities. The purpose of this trial was to feed a “standard” budget we would see in commercial production fed by our customers across the country and compare that to a budget that would ideally save at least $1 per pig in the nursery. The following trial was conducted side by side with small pigs of the weaning group sorted into one room. The feed budget can be found in Table 1. The pigs were weighed at weaning, 14-days, 35-days and the completion of the trial. The results based on the various days spent in the nursery can be seen in Table 2. These results show the effects of feeding a less costly budget based on the amount of starter (BioSure™ Respond) and transition feed (BioForce® 180) compared to a more recommended practice with more starter and transition feed. Although the Cost Saving’s budget achieved its goal of be-

Samuel Waititu, Ph.D. | Saymore Ndou, Ph.D. Monogastric Nutritionists AB/SK: 1-866-610-5770 | MB: 1-866-626-3933 fortifiednutritionltd.com

ing less costly on a feed cost per pig and cost per kg gain basis, the overall weight gain, ADG, FCR and margin over feed was less efficient than our standard budget. So, the big question is, what does this really mean?

Table 1: Feed Budget Compared Side By Side

Feed Budget (kg/pig) BioSure™ Respond BioForce® 180 BioForce® Piglet 32

Standard 1.5 4 Balance

Cost Savings 0.5 3 Balance

* Small room of pigs received 0.5 kg more Respond ** Meds in the feed were CT *** Commodities included corn, soybean meal, and baker

In a situation where health and management are very good, there may be a way to reduce feed cost by simplifying the budget by feeding less of these first two feeds. However, it is extremely important to recognize the impact it may have on the overall picture of raising a nursery pig. With almost 1 kg difference in end weight, that generally represents three days to market at the end of the finishing period. Assuming that the finishing animal is eating approximately 3.5 kg/day of the last stage feed, this has an implication on the overall bottom line for the farm as well - not only fewer days but additional feed cost. Before looking at simplifying the budget by feeding less of the first two phases, I would recommend you discuss this with your (GVF/FNL) Swine Sales representative.

Table 2: Performance at Various Timepoints on Trial

Program Performance Comparison Standard Cost Savings # Pigs Start 200 199 # Pigs End 200 197 Overall Livability (%) 100 99 Start Weight (kg) 6.91 6.80 14-Day Weight (kg) 11.40 11.13 35-Day Weight (kg) 25.32 24.17 43-Day Weight (kg) 32.63 31.68 14-Day ADG (g/d) 321 304 35-Day ADG (g/d) 526 494 43-Day ADG (g/d) 598 575 14-Day FCR 1.05 1.06 35-Day FCR 1.35 1.40 43-Day FCR

1.42

14-Day Feed Cost/Pig (&)

+ 28%

35-Day Feed Cost/Pig (&)

+ 11%

43-Day Feed Cost/Pig (&)

+ 9%

14-Day Cost/kg Gain ($/kg)

+ 19%

35-Day Cost/kg Gain ($/kg)

+ 5%

43-Day Cost/kg Gain ($/kg)

+ 5%

Overall MOF ($)*

+ 4%

1.44

*Margin Over Feed = ($3 * Weight Gain) - Feed Cost *The percentages for cost represent the increase in one side over the other ie. at 43 days the standard budget cost 5% more for cost/kg gain however they also produced 4% more margin

There are several aspects to consider: • Are you willing to give up gain at the end of the nursery in order to reduce feed cost? • What is your weaning weight? This will play a big part in starting your early weans off on the right foot. • On average, how is performance overall? Are your pigs hard to start on solid feed? What is the health status? These will play an important part in how simple a budget can go because we need to make sure we support the growth and efficiency of the pigs to the best of our ability. We can help reduce feed cost per pig by reviewing budgets which may become dependent on market conditions and a change of goals. We can also further discuss how this may impact herd performance and pig flow. For any questions on this trial or about nursery budgets, I would be happy to help you and answer any questions you may have for helping to increase efficiency and positively affect the bottom line for your farm: victoriaseip@grandvalley.com n

EVALUATION OF THE BIOFORCE® FEEDING PROGRAM

by: SAMUEL WAITITU Monogastric Nutritionist, Fortified Nutrition Ltd & VICTORIA SEIP Livestock Business Intelligence Manager, Grand Valley Fortifiers

n the first article of this series, we reported the growth enhancement power of our BioForce® grower-to-finish (GF) feeding program. It is amazing to reiterate that without use of other growth enhancement supplements except phytase, we could achieve a final live weight of 129.9 kg in 164 days, actualized by a 1 kg overall average daily gain and a 2.84 feed conversion ratio. The objective of the current article is to describe the carcass quality measurements at the slaughterhouse, hence provide a platform to judge the profitability of the BioForce® GF feeding program.

Number of hogs shipped

The average number of hogs shipped per month in the preceding 3 months (under a competitor’s feeding program) before the BioForce® GF feeding program commenced was 1531. The average number of hogs shipped per month in the first 3 months under the BioForce® GF feeding program was 1784, that is a 16.6% increase (253 more pigs shipped monthly). When the sales representative reported that the producer had to introduce another load of hogs, it was hard for me to understand why until this data arrived in my hands. For the next 6 months (after the first 3 on the BioForce® GF feeding program), the average number of hogs shipped per month was 1805, that is a 1.2% improvement (21 more pigs shipped monthly) on the BioForce® program.

Percentage of hogs in Core

It is the desire of every hog producer to ship in the grid core so as to minimize deductions on the value of each shipment. As shown in Figure 1, during the 9 months of the trial, of the 16,183 hogs that were shipped to the slaughter plant, overall, 94.01% were in core, 3.48% below core and 2.49% above core. This observation boosts confidence in the ability of the BioForce® GF feeding program to meet target grading grid weights for every batch coming into the finisher barn.

Leanness, Backfat, and Index

The increasing demand by consumers for leaner pork cuts has prompted carcass grading systems to consider lean yield as an important criterion of pork quality, hence making lean yield a key component in adjusting producer payments for carcasses. Generally, to achieve the highest-grade index premium from a Grading Grid, the two rules of the game are to target the preferred dressed carcass weight range and the preferred estimated lean yield by controlling fat at the market weight. As shown in Figure 2, there was an inverse relationship between leanness and backfat. It is visually clear that our feed formulation strategies to reduce backfat from August 2020 to January 2021 were very effective. However, towards the end of the year 2020, we decided to loosen the nuts a bit at the request

Swine Grist days of his career in Livestock Nutrition and Pharma Sales Representative positions. He worked at Commercial Feed Mills for the last 13 years in operations, nutrition, and business management. Tom currently lives in Bornholm, Ontario, fifty minutes outside of the Kitchener-Waterloo region, with his family. Tom joined the GVF group on Monday March 21st 2022, and will be based out of Cambridge, Ontario. We are excited to have Tom join the team and look forward to introducing him to our customers. Please join us in welcoming Tom Reidy to the GVF group of companies! n of the producer to promote weight gain of the smaller pigs, just to make sure the loading dock remains active and busy. As illustrated in Figure 3, the lowest index reported was 108.9 in both September 2020 and April 2021, which interestingly corresponds with the highest backfat levels reported during the entire period, 20.90 mm in September 2020 and 20.70 mm in April 2021. Therefore, the pigs responded positively to the change in formulation with an upward trend in backfat countered by a downward trend in index. Consequently, by April 2021 the average backfat was 0.40 mm higher and the index was 0.39 points lower than their 9-month averages. However, the drop in index would be well covered by the increased number of hogs going to the slaughterhouse, hence it was not a terrible bargain.

In conclusion, as I try hard to keep true to King Solomon’s advice, “let another praise you, and not your own mouth; a stranger, and not your own lips”, I would politely say that this trial’s data positively reflects the strengths of the BioForce® GF feeding program beyond the on-farm loading dock. It’s power to stimulate growth was evidenced by reducing the days to market of the slow growing pigs and hence delivered more hogs to the slaughter. Furthermore, the observed interaction between a change in formulation, backfat and index, illustrates how sensitive pigs are to the slightest changes in nutrient specifications. To the producers, one of our objectives in carrying out and sharing this trial’s data is to promote our open platform for your consultation with the FNL Nutrition team on fine tuning your feeding programs to achieve the desired goals in production and profitability. Since this trial is ongoing, in a subsiquent issue, we will share the results of a full year performance of the BioForce® GF feeding program. n

WELCOME TOM REIDY: NEW MANAGER OF MONOGASTRIC NUTRITION

UNDERSTANDING THE MARKETS

by: BRIAN GONDER VP & COO, GVF group of companies

n late 2021, price increases affected the Feed and Nutrition market as products all around the world became affected by increased demand, trucking shortages, and COVID-19 shutdowns. It is uncommon to experience so many cost pressures at one time so we will attempt to explain the factors we are witnessing and why we continue to face the fallout of these uncertain times. Over the past year and a half, the market has experienced many different dynamics: From a world-wide pandemic, to natural disasters in BC, to environment shutdowns in China (due to New Years and Olympics), to a war in Europe. Below are a few of the main factors that we have seen affect the market over the past several months. We hope this helps to provide clarify on the difficult supply chain situation we are facing globally.

Phosphates – China’s export ban

Phosphates have and will contunue to see increases in market prices due to China’s ban on phosphate exports through June 1, 2022. As we get close to planting season, the demand will continue to increase and will also cause prices to swell. Dical suppliers around the world have been put on ingredient allocation, which has pressured feed and premix companies. Urea, a phosphate-based product, has also seen increases and will continue to react to the ebbs and flows of the phosphate market. The upcoming planting season, and uncertain Global Soybean Meal and Wheat supplies are adding to the pressure over the next few months.

Russia and Ukraine

The war between Russia and Ukraine continues and concerns continue to grow regarding oil and crop supplies for the later part of this year. Together, Russia and Ukraine supply 26% of the world’s corn and 28% of the world’s wheat production. As sanctions continue to build against Russia, oil supply continues to tighten causing increased prices on all Vegetable oil-based products. Crude oil has recently hit a 10-year high, directly affecting the cost of specific products, while also increasing product costs as transportation costs continue to increase due to fuel surcharges and driver shortages.

e are very pleased to share the news and announce the hiring of Tom Reidy for the position of Manager of Monogastric Nutrition with the GVF group of companies. In this position, Tom will be responsible for providing strategic leadership to the monogastric nutrition team across Canada and will oversee operations within the department, ensuring the best nutritional support is provided to customers. Tom brings over 20 years of poultry and swine nutrition, sales, and operations experience in both commercial complete feed and premix sectors. Graduating from the University of Guelph with a Masters in Poultry Nutrition, Tom spent the early

for tifiednutritionltd.com

Shipping containers and trucking prices increase

Increases in oil prices, have impacted the cost of deliveries to our customers and the materials arriving to our plants and warehouses. Over the past several months we have seen shipping containers and trucking prices increase threeto-four-fold as the demand for products continues to increase. Currently in North America, there are 153 loads waiting to be shipped for every one load shipped. Many of these increases have been due to port backups and natural disasters. With Chinese New Year, and the Beijing Olympics behind us, there is a more hopeful tone that the supply chain will improve over the coming summer months. China has recently re-implemented a Zero Tolerance for COVID cases and in late March, Shanghai China has gone into full lock-down. Unfortunately, this may cause a lag of returning to a more normal supply and port situation.

Inflation – From key ingredients to water bottles

Across Canada, we have seen inflation affect almost all products and services. Canada’s consumer price index for 2021 was over 5% for the first time since 1991. Many products throughout different industries have increased by 5,10, 15 or even 20%. We are working to continue to limit these increases however they are affecting all aspects of the supply chain.

Amino Acids

There is uncertainty and disparity on multiple amino products as we look at pricing and availability for upcoming months. As methionine is heavily linked to crude oil prices, methionine prices have risen and settled higher due to high oil prices stemming from Russia’s invasion of Ukraine. Interestingly, lysine has begun to soften as factories have reopened after the Olympics and Chinese New Year. As a by-product of corn, it will be important to watch corn prices over the upcoming months to determine whether Russia and Ukraine have successful planting seasons. As you are all aware, today’s Global Supply chain is ever-changing and challenging however the purchasing team at Grand Valley Fortifiers remains committed to sourcing ingredients as economically as possible so that we can continue to provide nutritional solutions for you, our valued producers. n

AN IMPORTANT NEW ROLE ESTABLISHED: DIRECTOR, REGULATORY COMPLIANCE AND QUALITY MANAGEMENT

he Canadian feed industry is going through a multitude of changes as our federal feed regulations are being revamped for the first time since 1983. This revamp is a modernization of the feed regulations designed to reflect new information that has been discovered regarding animal nutrition. With Gazette II predicted to come out in the fall of this year we are anticipating the new regulations taking effect. In tandem with the new harmonization of the Feed Regulations by the Canadian Food Inspection Agency (CFIA), the Animal Nutrition Association of Canada (ANAC), the Canadian livestock feed industry’s trade association, has launched their update of Feed Assure V4, the nationally recognized HACCP program for our feed industry. This latest version has some key areas of change, including an increased focus on biosecurity, feed defense/feed fraud and crisis management, risk assessment (particularly with ingredient approval) and increased standards. These new standards for Assure will come into effect in 2023. Additionally, at the producer level, a new national program, The Canadian Pork Excellence (CPE) program has been launched. The transition deadline to the CPE is December 31, 2023. This means that all producers must have completed a full validation on the CPE program before January 1, 2024. This program will replace the Canadian Quality Assurance (CQA) program, which covers traceability (Pig TRACE), food safety (Pig SAFE) and animal care (PigCARE). With all these areas of significant change in regulation and enforcement, Grand Valley Fortifiers decided it would be prudent to create a new position of Director, Regulatory Compliance and Quality Management to provide oversight

and guidance of these important standards across the GVF group. We are pleased to announce that Bruce Schumann, previous lead of our Monogastric Nutrition team, has accepted and transitioned into this new role. Bruce has been with the GVF group of companies for over 22 years and brings a wealth of experience to this position. Initially, Bruce became GVF’s HACCP coordinator and led his team through their first Feed Assure certification back in 2001. He has served on the ANAC steering committees including the development of heavy metal guidelines for ingredients used in the Canadian feed industry and was invited by the CFIA to help develop an establishment-based risk assessment model in the feed sector in 2019. Bruce has been responsible for our Organic Certification though both the Canadian Organic Standards (COS) and the National Organic Program (USDA/FDA) and served as an advocate for our producers in the scientific review of the Canadian Organic Standards, particularly revolving around phytase and amino acid usage in organic production. Bruce has assisted industry partners in attaining commercial feed mill status with the CFIA including writing policies and procedures for their mills to ensure their compliance with the Feeds Regulations as well as the Canadian Ractopamine-Free Pork Certification Program. He has gained organic certification for commercial feed mills as well as making them compliant and getting approvals for national method of production claims such as Raised Without Antibiotics (RWA), Vegetable Grain Fed (VGF) and No animal By-Products (NAB) programs. Bruce was responsible for the original development and oversight of operation manuals, nutritional programs, audit checklists, audits and protocols for RWA/ VGF/NAB and omega-3 claims back in 2008 when method of production claims were first launched by the Label and Registration Unit with the CFIA. In this new position, Bruce will be overseeing new regulatory and Feed Assure V4 compliance, overseeing our Feed Assure coordinators, developing a national Quality Assurance/Quality Control program, and working on corporate social responsibilities including emerging issues with our producers, animal welfare, safety concerns and biosecurity as well as product registrations and exploring added value market opportunities for our customers. We are thankful to have Bruce Schumann step into this important role and encourage you to reach out to him with any questions. n

Thought for the Day

Challenging days draw us closer to God.

We are all living in challenging days, some more so than others. In this passage Paul reminds us that followers of Christ are not promised a blissful life but rather hardship and trial, which in turn draw us closer to God who has not promised to shield us from it but to carry us through it. Be encouraged as we enter spring 2022, God is in control. Romans 5:1-5 - NIV “1Therefore, since we have been justified through faith, we have peace with God through our Lord Jesus Christ,2through whom we have gained access by faith into this grace in which we now stand. And we rejoice in the hope of the glory of God. 3Not only so, but we also rejoice in our sufferings, because we know that suffering produces perseverance; 4perseverance, character; and character, hope. 5 And hope does not disappoint us, because God has poured out his love into our hearts by the Holy Spirit, whom he has given us.” “Paul tells us that in the future we will become, but until then we must overcome. This means we will experience difficulties that help us grow. We rejoice in suffering not because we like pain or deny its tragedy, but because we know God is using life’s difficulties and Satan’s attacks to build our character. The problems that we run into will develop our perseverance – which in turn will strengthen our character, deepen our trust in God, and give us greater confidence about the future.” 5: 3,4 commentary - NIV Life Application Bible published by Tyndale House Publishers