1. Production Control I: The Key To Profits David A. Roland 1, Sr., M. M. Bryant 1, M. Farmer 2 and A. Roland 3 Auburn University 1 Auburn, AL Ridley Inc. 2 Mankato, MN Roland Poultry Services, LLC. 3 Auburn, AL SPSS Atlanta, GA January 21-23, 2008

2. Production Efficiency has never been better! Egg Producers (losing money) (losing money) Egg Producers (losing money) (losing money) PRODUCTION MANAGER MARKETING MANAGER WE HAVE TOO MANY EGGS! Low Egg Prices

3. HIGH EGG PRICES AND PROFITS MARKETING MANAGER Goal: highest egg price We need more eggs! PRODUCTION MANAGER Goal: optimal production efficiency Come on girls…gimmie all you got! Production efficiency has never been better! Good Team Work Helps Optimize Profits …OK !

4. EXCESS EGGS = LOW EGG PRICES = NEGATIVE RETURNS MARKETING MANAGER Goal: highest egg price We have too many eggs! Losing Money PRODUCTION MANAGER Goal: optimal production efficiency Come on girls…gimmie all you got! Production has never been better! Poor Team Work Results in Excess Eggs and Negative Returns ?

5. PRODUCTION CONTROL = KEY TO PROFITS MARKETING MANAGER Goal: Highest Egg Price We have enough eggs! PRODUCTION MANAGER Good Team Work = Reduced Egg Supply and Faster Return to Profits Okay girls. Take a breather, demand has been met Thank you New Goal: Optimal Profits

6. Moral of the story…. Marketing and Production working together using new technology can improve production control and profits!

7. .72.75.79.83.87.92.97 Economically Optimal maximum response deficient Nutrient requirement for max profit varies Nutrient level (Lysine, Protein) Cost Performance How nutrient requirements are determined ? 1.01 14.314.815.315.816.517.217.818.58.0

8. Feeding Based on Intake (Lys. Mg/h/d) FC (lbs/100h/d)(W-36) DietLys.181920212223 218.97 792 (229) a 881 (255) a 1013 (293) a 219.92792835 220.87 790 (229) a 792 (255) a 908 (293) a 221.83753792 222.79717792 223.75 612 (229) a 681 (255) a 792 (293) a Typical Feeding Program a ME/h/d

9. Profits (¢/doz.) (Phase II) FC (lbs/100h/d)(W-36) DietLys%181920212223 218.97? 219.92? 220.87? 221.83? 222.79? 223.75? Feeding based on intake saves money. Blindly making changes.

10. Profits = UB egg price – [ Back of UB – Prod. Cost – Process. Cost – Feed Cost ] Example: Production cost Cost of nest run into package product delivered Back Urner Berry

11. Profits (¢/doz.) (Phase II) Feed Consumption (lbs/100h/d) (W-36) DietLys181920212223 218.97.57.830.10-0.69-1.53-2.03 219.92.631.090.84-0.04-0.91-1.35 220.87.331.081.240.53-0.30-0.76 221.83-.101.071.160.760.19-0.27 222.79-1.060.220.960.770.48-0.05 223.75-2.30-0.54.550.490.17-0.03 Best diet varies depending on egg and feed price

12. Profits (¢/doz.) (Phase II) Feed Consumption (lbs/100/day) DietLys%181920212223 218.97 -17.43-17.85-19.00-20.19-21.11-22.41 219.92 -16.71-17.14-17.93-18.96-19.96-21.20 220.87 -16.36-16.71-16.94-17.88-18.95-20.23 221.83 -16.11-16.33-16.71-17.23-18.03-19.31 222.79 -16.30-16.33-16.59-17.09-17.33-18.65 223.75 -16.64-16.46-16.32-17.05-17.35-18.09 Low Egg Prices with High Protein Cost

13. Profits (¢/doz.) (Phase II) Feed Consumption (lbs/100/day) DietLys%181920212223 218.97 -14.86-15.21-16.27-17.28-18.08-19.21 219.92 -14.93-15.30-16.01-16.98-17.87-18.99 220.87 -15.30-15.60-15.80-16.69-17.71-18.92 221.83 -15.68-15.70-16.26-16.77-17.54-18.79 222.79 -16.50-16.53-16.80-17.30-17.55-18.89 223.75 -17.42-17.27-17.35-17.91-18.23-19.03 Low Egg Prices with Low Protein Cost

14. 18% P Phase 1 - 18% I. Prior to 50’s – fed one diet II. 60’s (fed based on age) III. 70’s ( fed based on intake) IV. 80’s & 90’s (Envir. Cntl. & soft ware) 20 th Century 21 st Century V. 2000’s Econometric Feeding Important Periods in Optimizing Protein and Energy Phase 2 - 17% Phase 3 - 16% 181920212218192021221819202122 Lbs/100 h/d 1819 20 212218192021221819202122 Lbs/100 h/d Example: Product X 18.918.517.516.816.2 % Prot. 20 14% VI. Production Control

15. Econometric Feeding and Management (E F & M) Program 1.Feed formulation 2.Traditional feeding program 3.Record keeping * 4.Econometric Feeding and Management (E F & M) 5.PRODUCTION CONTROL

16. Wks 21-36Production (%)Egg weights (g) flkF18.917.516.3dec18.917.516.3dec 1997887.687.086.51.454.654.054.40.2 2007888.687.587.21.456.556.355.21.4 3007888.988.586.52.456.655.555.70.9 4016894.394.292.32.056.455.855.50.9 5026893.191.791.91.258.157.557.40.7 6026889.1 88.20.955.955.755.40.5 7026890.489.888.32.155.354.854.40.9 8026891.989.792.155.354.754.31.0 9026895.293.393.22.055.555.454.70.8 Avg 91.090.189.61.456.055.555.20.8 Lysine 1.02 0.92 0.83 1.02 0.92 0.83

17. Profits (¢/doz.) (Phase II) FC (lbs/100 h/d) DietLys.% 181920212223 218.970.10 219.920.84 220.87 1.24 (789-825) 221.831.16 222.790.96 223.75.55 20 lb = 789 mg/h/d, 20.9 lb = 825 mg/h/d (5% variation) Can we improve Lysine (mg/h/d) Delivery? 20.0 20.9 lbs/100 h/d

18. Available Lysine Standard Lysine (mg/h/d) Pre-MoltPost-Molt I II III I II III Weeks of ageWeeks after molt IV Phases

19. Phase II - Egg Weight 218 219 220 221 222 223 %LysDiet

20. How to Adjust Nutrient Intake in ± 2.5% (.5 lb) Increments Lb/100/d192021 % Lysine.94.89.84 Intake (19.5) 19.0 - 19.9 (20.5) 20.0 – 20.9 (21.5) 21.0 – 21.9 Lys mg/h/d 817 Intake (19.0) 18.5 - 19.4 (20.0) 19.5 – 20.4 (21.0) 20.5 – 21.4 Lys mg/h/d 800 Intake (20.0) 19.5 - 20.4 (21.0) 20.5 – 21.4 (22.0) 21.5 – 22.4 Lys mg/h/d 840

21. Flock Variation (Avg. wk 21-36) Environmental Control FlockEW (g)Prod. (%)FlockEW (g)Prod. (%) 151.186652.280 251.388752.886 353.281852.487 453.381954.984 553.6831053.578 Complex Avg. – best 1 million + Variation in egg weights = 3.8g/egg (3.0 lb/case) vs 1.2 g/egg Variation in egg production = 10 % vs 2.4 % diet