Don't roll the dice on quality when you buy feed. Knowing if the feed you are intending to buy is good value for money is critical before handing over your hard-earned money.
Some quick number crunching can give you a much clearer idea whether you are buying good quality and good value feed.
Three steps of the buying process
1. Plan well - prepare feed budgets regularly and determine the maximum feed price you can afford to pay and still make a profit for your business.
2. Buy right - take into consideration feed quality, feed supply as well as price risks.
3. Feed carefully -Â avoid unnecessary feed losses through wastage at delivery, storage and feed-out.
Feed buying methods - farm-to-farm verses trade purchases
At first glance, buying direct from a grain or fodder producer to save costs versus from a feed trader or merchant may seem appealing, but it's always an idea to have a closer look.
Making the choice between a 'direct' purchase farm-to-farm versus a 'trade' purchase means considering the 'contract management' issues and the 'physical movement' issues when sourcing grain or fodder.
You must also consider supply chain costs, market volatility and supplier risk.
- Visually assess a feed's physical quality first.
- Look beyond the price tag - crunch the numbers using feed lab analysis results.
- Make sure you use reliable feed analysis results for your value assessments.
- Use yardsticks to determine value per unit energy and protein.
- Consider whether you have the time to manage all the tasks associated with managing feed supply.
- Effective management doesn't happen by itself; a stockfeed company, merchant or trader can take these tasks off your hands, so make sure you factor in your time before you take it on.
- Can you monitor feed prices on a daily/weekly basis to know what is happening in the market or do you use a trusted merchant to keep you informed?
- Can you manage supplier risk or does it become your problem if the supplier doesn't have the feed or fails to deliver, or do you leave that to a stockfeed company, merchant or trader?
Don't gamble with feed quality (PDF, 541KB)
Buying on value, not price. Visually assess a feed's physical quality first. Look beyond the price tag - crunch the numbers using feed lab analysis results. Use yardsticks to determine value per unit energy and protein.
- Using your senses and experience first
- Things to look for (table)
- Look beyond price tag
- Incorporates series of examples on working out calculations
- Buying energy and protein
Buying feed direct farm to farm (PDF, 414KB)
Factsheet on understanding difference between direct buying (farm to farm), via a broker and third party methods.
- Key tips
- Supply chain costs
- Market volatility
- Supplier risk
- Monitoring feed prices
- Contract execution
- Grain crushing - on-farm or outsourced
3 steps to better feed buying decisions (PDF, 266KB)
Factsheet outlining three-step approach to buying feed and provides key tips for success:
- Plan well (feed budget, target feed price for profit)
- Buy right (quality, supply, price)
- Feed carefully (store feeds, feed diet to herd)
Buying grain - it's a world market (PDF, 499KB)
Factsheet to help set a strategy to manage price volatility in the global market. Includes:
- Overview of global grain market
- Explanation of supply/demand
Buying fodder - it's a domestic market (PDF, 532KB)
- Unlike grain, fodder is a domestic market.
- Hay prices are less transparent than grain prices.
- Consider your on-farm fodder buffer.
- Be proactive in developing a relationship with a professional hay producer