Feed Strategy - November 2019 - 24

24 ❙ FeedStrategy

More feed,
fewer mills:
feed industry
consolidation
How technology, integration
and regulations are reshaping
US feed production
EMMA PENROD

T

here were originally no less than three feed mills
in Forest Lake, an old railroad town in eastern
Minnesota. But times have changed. The last
mill, known as E. J. Houle's Feed Mill, closed its doors
earlier this year.
The mill had been in the Houle family for three
generations, according to Gary Houle, the company's
final owner. Over the years, they have watched
industry trends come and go. The mill's business
boomed in the 1950s alongside the growth of the
area turkey industry; that was gone by the 1970s.
Eventually, the demand for pet food supplanted products intended for production agriculture.
In recent years, a new trend has begun to emerge.
While the overall feed industry continues to enjoy
steady growth, the number of feed mills in operation in
the U.S. fell by 11% between 2015-2017, according to a
study by CoBank.
Market forces, industry analysts say, are likely to
push mills further down one of two bifurcated paths.
Commercial feed companies will continue to build
bigger, more sophisticated mills focused on reducing
manufacturing costs, while smaller independent mills
run the opposite direction, focusing on increasingly
specific markets. Some already serve a single farm.

Changes in agriculture
This consolidation in the feed industry mirrors larger
trends in agriculture, according to Tanner Ehmke, who
oversees industry research at CoBank.
"Demand from the livestock sector is growing and
changing as well," Ehmke says. "We're seeing this
trend toward bigger and bigger farms."
Not too long ago, he says, a dairy might consist of 50
cows. Now, a farm with 300 cows is considered small.
"So, as we continue to see an evolution in the livestock
sector, they're going to need larger orders of feed, and if
you're a small mill, that's going to be harder."
Like farms, feed mills are "continually getting
larger and larger because of the efficiencies to be
gained," according to Charles Stark, the Jim and Carol
Brown Professor in Feed Technology at Kansas State
University. Even the scale of the equipment has changed,
he says - where in the 1980s, an 8-ton mixer was
considered standard, now 12 tons is the new average.
Feed mills are also increasingly turning toward
automation to reduce labor costs, which may in time
result in fewer jobs in the feed industry.
"All of agriculture is becoming more capital intensive, rather than labor intensive," Ehmke says.
Meanwhile, the 2011 passage of the Food Safety
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Feed Strategy - November 2019

Table of Contents for the Digital Edition of Feed Strategy - November 2019

Feed Strategy - November 2019
Contents
In the Mix
FeedStrategy.com
Climate change and animal feed: mycotoxin risk mitigation
How to adapt to the changing mycotoxin landscape
Scientists seek new ways to combat spread of mycotoxins
Feed additives that will succeed in 2020 and beyond
Marketing nutrition by extending credit
More feed, fewer mills: feed industry consolidation
How to target protein content in late-lactation cow diets
Critical junctures in early chick nutrition confi rmed
How pelleting influences particle size in animal feed
Products
Advertisers’ Index
Feed Strategy - November 2019 - CT1
Feed Strategy - November 2019 - CT2
Feed Strategy - November 2019 - Feed Strategy - November 2019
Feed Strategy - November 2019 - Cover2
Feed Strategy - November 2019 - CT3
Feed Strategy - November 2019 - CT4
Feed Strategy - November 2019 - Contents
Feed Strategy - November 2019 - In the Mix
Feed Strategy - November 2019 - FeedStrategy.com
Feed Strategy - November 2019 - Climate change and animal feed: mycotoxin risk mitigation
Feed Strategy - November 2019 - 5
Feed Strategy - November 2019 - 6
Feed Strategy - November 2019 - 7
Feed Strategy - November 2019 - How to adapt to the changing mycotoxin landscape
Feed Strategy - November 2019 - 9
Feed Strategy - November 2019 - 10
Feed Strategy - November 2019 - 11
Feed Strategy - November 2019 - Scientists seek new ways to combat spread of mycotoxins
Feed Strategy - November 2019 - 13
Feed Strategy - November 2019 - 14
Feed Strategy - November 2019 - 15
Feed Strategy - November 2019 - Feed additives that will succeed in 2020 and beyond
Feed Strategy - November 2019 - 17
Feed Strategy - November 2019 - 18
Feed Strategy - November 2019 - 19
Feed Strategy - November 2019 - 20
Feed Strategy - November 2019 - 21
Feed Strategy - November 2019 - Marketing nutrition by extending credit
Feed Strategy - November 2019 - 23
Feed Strategy - November 2019 - More feed, fewer mills: feed industry consolidation
Feed Strategy - November 2019 - 25
Feed Strategy - November 2019 - 26
Feed Strategy - November 2019 - 27
Feed Strategy - November 2019 - How to target protein content in late-lactation cow diets
Feed Strategy - November 2019 - 29
Feed Strategy - November 2019 - 30
Feed Strategy - November 2019 - Critical junctures in early chick nutrition confi rmed
Feed Strategy - November 2019 - 32
Feed Strategy - November 2019 - 33
Feed Strategy - November 2019 - How pelleting influences particle size in animal feed
Feed Strategy - November 2019 - 35
Feed Strategy - November 2019 - 36
Feed Strategy - November 2019 - 37
Feed Strategy - November 2019 - 38
Feed Strategy - November 2019 - Products
Feed Strategy - November 2019 - Advertisers’ Index
Feed Strategy - November 2019 - Cover3
Feed Strategy - November 2019 - Cover4
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