Looking Forward in Feed
Brent Vorpagel, Feed Department Manager
As we look to the new year the state of the dairy industry is a constant topic of discussion. With increased operating cost and decreased milk prices dairy producers have been losing money for more than 4 years with no relief expected in 2019. This has led to many dairies exiting the business in the last few years, and more are expected in 2019. As dairy producers have made the hard decision to sell their cows our dairy feed tons have decreased.
With dairy being the largest species we feed the decreasing cow numbers have made for many challenges. Fewer dairies obviously means fewer cows to feed. The dairies that remain continue to decrease all the purchased feed they possibly can to save cost. As a result the feed industry has gotten extremely competitive trying to get the feed business of the remaining dairies. The importance of each cow and ultimately each ton is magnified for all dairy feed manufacturers.
It is important to remember with any challenge there are always opportunities. The changes in the dairy industry are very noticeable, however we can’t lose sight of the success we are having. Our tons for most other species are steady to unchanged, and we have added several new customers lately that will likely lead to other new opportunities. The feed department continues to be profitable and ahead of budget for this fiscal year.
We need to make sure that we are doing everything we can to remain profitable and relevant in the feed industry going forward. Our assets and strengths that have helped us be successful in the past will continue to help us be successful in the future. Thanks to all the investments we have made over the last 10 years our feed mill and equipment are able and ready to help us well in the future. We will also continue to invest in good people because ultimately our employees always have been, and will continue to be, the key to our success. We all need to continue to work hard every day for our customers. Please make sure you follow up on any and all opportunities you encounter in your daily responsibilities. If an opportunity is out of your area of expertise please share it with someone else so we can follow up accordingly. In a similar manner if you encounter customers with concerns please bring them forward so we can get them addressed and maintain a happy customer. I know it can be very easy to get negative when we consider the current state of the dairy industry, but we must remain positive. Markets cycle, things happen and a lot will change with time. No matter what remember, “whether you think you can or you think you can’t you are right!” By the way I have a $5 bill in my office for the first person that can tell me what movie that is from (without looking it up on the internet).