Advancing our Feed Operations: Key Upgrades and Market Performance

It’s been a very active winter as we have finished multiple significant capital projects in the feed division. In Hubbard, we replaced the exterior siding of our feed mill and warehouse, Cuba City moved into the new 4,000 sq. ft. warehouse addition, and Hopkinton just completed an upgrade to the receiving and mixing legs. Additional projects include rolling stock updates, such as three new forklifts, a flatbed pickup, a 24-ton feed trailer, a used tandem feed truck, and a small box van for bag deliveries. All these upgrades enhance our ability to service our customers and at the same time improve our efficiencies. 

Currently, the feed division is tracking a little below budget. Increased repair and labor costs continue to be the driving force in the first six months of FY2025 from an expense, and on the revenue side, total feed tons are down with margins slightly lower. We continue to work on business goals with a sales focus on gaining new business and using technology and business management tools to help our producers. 

Today, swine producers are challenged to source weaner pigs as sow units still feeling the effects of disease. With inventory low, the cost of a weaner is up significantly, making a negative return. Even as input costs are down slightly from a year ago, this is one of the main reasons our tons have been off since a year ago. Our swine team continues to work hard to create and grow relationships with potential customers. 

Our dairy tons and margins are slightly lower than last year. Class III milk has been trending lower. USDA has stated that milk production is increasing nationwide. The USDA pegged December milk production of the 24 major dairy states at 18.0 billion pounds, down 0.4% from last year but 4% above the 17.3 billion pounds in November 2024. 

On the beef side of things, feedlots are full, and our bulk Quality Liquid Feed tons continue to grow. It is a very high-risk, high-reward time in the cattle business. The smallest cow herd in fifty years, but we made up for it with the biggest cattle in history. With all the record-high volatility still going on, the beef industry has seen the third straight year of unprecedented profitability. 

From a feedstuffs standpoint, commodity prices have been trending lower than a year ago with good supplies. Soybean meal has been a major driver in lowering prices with several new crush plants that have come on stream over the last 18 months. January’s USDA report lowered both corn and soybean production, but still respectable production numbers and good world supply. Commodities, forages, and by-products all seem to be in good supply in the marketplace. 

We continue to focus on our relationships with our partners. Emphasizing what they can provide to help us grow our business and streamline our product lines to provide our customers with a valued product. 

Thanks again for all you do to make the IAS feed business successful.