Guests: Dr. Kevin Dhuyvetter, Elanco & Dr. Phillip Jardon, Iowa State University Extension While Dr. Jardon only had milk in his glass for this pubcast, he did share about his bottle of “wheyskey” (whiskey made from whey) from Wheyward Spirit Distillery in California (https://www.wheywardspirit.com/). Iowa State Dairy Extension is offering a webinar, “Fermentation and Distillation of Whey to Produce Spirits at Copper Crow,” on May 15 at noon Central. Curtis Basina of Copper Crow Distillery in Bayfield, WI, will be the speaker. You can sign up for the webinar at https://go.iastate.edu/WHEY (4:13)
While Dr. Jardon only had milk in his glass for this pubcast, he did share about his bottle of “wheyskey” (whiskey made from whey) from Wheyward Spirit Distillery in California (https://www.wheywardspirit.com/). Iowa State Dairy Extension is offering a webinar, “Fermentation and Distillation of Whey to Produce Spirits at Copper Crow,” on May 15 at noon Central. Curtis Basina of Copper Crow Distillery in Bayfield, WI, will be the speaker. You can sign up for the webinar at https://go.iastate.edu/WHEY (4:13)
Dr. Dhuyvetter presented a March 5 webinar on dairy economics, which can be found at balchem.com/realscience. Key consistent data across time indicate that more profitable dairies tend to be larger. This doesn’t mean that all dairies must be large, but more the reality of the large number of fixed costs in dairying. Diluting costs by having high production per cow is also a mark of a profitable operation. Kevin reminds the audience that he’s talking about averages and there are exceptions to every rule. The key message is that you need to strive to get better. In the long run, profits are equal to zero in a competitive industry, and dairying is no exception. Dr. Dhuyvetter includes all economic costs in his analyses, recognizing all assets, including skills and capital, such as land, facilities, and time. (8:08)
Dr. Jardon suggests that exceptional operations emphasize efficiency and ensure they dilute maintenance costs well. Everything is fine-tuned: feed's always pushed up, stalls are full of bedding, and the time budget of the cows is usually spot on. Dr. Tully echoes this sentiment from his consultant experience. Phil also underlines the importance of focusing on how much it costs to make a unit of milk or income over feed costs rather than concentrating solely on saving money. Kevin agrees that all the little things done right and done consistently often make the difference in profitability. Further, if cutting costs negatively impacts production, then saving money is counterproductive in the long run (15:14)
Dr. Dhuyvetter reminds producers not to automatically assume they have lower costs because you raise your own feed. More often than not, the opportunity costs of producing that feed haven’t been evaluated. If you can produce nutrients more efficiently and cost-effectively on your land, then home-raised feed is a very good thing. But if you produce low-quality home-raised feed, it might be better to purchase feed elsewhere. In addition, growing high-quality feeds takes time and energy away from dairying. Phil saw this when he was a practicing veterinarian. Jim suggests that those larger operations can have a field crew and a herd health crew who aren’t the same individuals. The panelists discuss the shift from getting paid for protein in milk to getting paid for fat in milk and what that means from a cow nutrition and profitability perspective.
(22:51)
Dr. Dhuyvetter then discusses how culling practices impact profitability. He expects successful operations to have very low cull rates because they have healthy, well-managed cows doing all the little things right. On the other hand, unsuccessful operations may also have very low cull rates because they struggle to produce heifers, get them pregnant, and keep them in the herd, leading to keeping cows longer than one should. Jim and Kevin emphasize that the culling rate is individualized and will vary by operation. Phil suggests that perhaps some of the available software tools to help with culling decisions may be underutilized. (35:10)
Many dairies want to know if they should wait longer into lactation before rebreeding cows. Because production is up and reproduction has improved over the last 10-15 years, dairies are drying cows off while still giving a lot of milk. Dr. Dhuyvetter’s analysis of the data for Holstein herds in second- and greater-lactation cows suggests getting them pregnant as fast as possible and getting them back to peak milk sooner. (43:07)
Phil, Kevin, and Jim then touch on comparative advantage and revealed preference and how those relate to shifts in the dairy industry away from some states and toward others. (50:29)
In closing, Dr. Dhuyvetter suggests that the days of being very successful with gut-feel decisions are probably behind us. Making decisions based on the best information from data and analytics is the way forward. Constantly strive to get better, and don’t worry about what your neighbor’s doing. Control what you can control. (58:29)
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Scott (00:00:07):
Well, good evening everyone, and welcome to the Real Science Exchange, the podcast we're leading scientists and industry professionals meet over a few drinks to discuss the latest ideas and trends in dairy nutrition. My name's Scott Sorrell, gonna be your host tonight. And I've got a new co-host this evening. I've invited Dr. Jim Tulley from California to join me as my co-host. Jim, how are you doing today? And welcome to the Real Science Exchange. This is your first time here.
Jim (00:00:32):
Yep. Yep. I appreciated the invite. I'm honored. I've, I've known Philip, who we'll get to in a minute for 30 years Kevin, a lot fewer than that, but have learned actually quite a bit from both of those gentlemen. So I was very honored when you asked me to sit in and co-host.
Scott (00:00:54):
You're very welcome. I'm, I'm excited to have you here. I don't know if you remember, but you and I met, it's gotta be in the early two thousands. I was working with, back then it was called Verus, and we had nutrients. And so that's, that's when you and I first met, so I was excited to Yes. Have you on as well. Jim, you have anything special in your glass tonight?
Jim (00:01:15):
I, you know, this time of day, it would have to be beer. Okay. Yep. And I'm, I live in Minnesota, but do work out west. In fact, I just got back from California last evening where it was sunny and 70 degrees for three days. So then I thought, well, well, since I'm home, I probably should start with a Sam Adams cold snap. Yeah. either getting cold or hopefully the cold snaps out of it. So that's what I'm gonna enjoy for the afternoon.
Scott (00:01:43):
Yeah. Excellent, excellent. So, our guest that we have this evening is Dr. Kevin Veter. Kevin did a webinar for us back on March 5th, and it was titled Dairy Economics Factors Affecting Profitability. Gave that back on March 5th. If you've not listened to that webinar, you need to go back and listen to it. You just go back, go to balchem.com/realscience. There is a lot of media information there, and if you're a nutritionist, forward it to your dairy farmers that they're gonna want to hear this. Now, I will say this is not an easy listening webinar, Dr. Dhuyvetter, It, it's, it's you're gonna wanna pour, you know, a double or maybe a triple to get through this one, because you're gonna find yourself pausing and backing up a lot as I've, as I've done in, in preparation for the podcast. But a lot of great information and looking forward to the discussion this evening. Now, Dr. Dhuyvetter, welcome your first time to the real science exchange as well. Anything interesting in your glass tonight?
Kevin (00:02:46):
Well, I am enjoying a bourbon barrel aged stout. Normally the way the weather was a week ago, I'd say I wouldn't have been drinking a stout, but good. And it's, it's a western Michigan beer Dragon's Milk, so it's kind of a dairy product, but not really. So that's what I'm enjoying tonight. Excellent pleasure to be here, too.
Phil (00:03:11):
Yeah. So dragons must be mammals if they have milk. I guess
Scott (00:03:16):
You don't wanna milk them. Do they fit into a rotary party? Anyway, so your, your, your guest has spoken up here. Dr. Dhuyvetter, would you mind introducing him?
Kevin (00:03:26):
Yeah, just real quick. So my guest is Dr. Philip Jordan, and Philip and I worked together at Lanco for 10 years. Just thoroughly enjoyed working with him. We've had a lot of interesting discussions over the years about economics and just all kinds of things. Recently he moved back to Iowa and he's now at Iowa State. And as much as we absolutely hated to see him leave Blanco, I, I have to believe he's really benefiting the people of Iowa because one thing about Dr. Jarden is he absolutely loves to teach people, and it's great. So I'm sure the people of Iowa are very welcoming of him.
Scott (00:04:07):
Oh, well, thank you for joining us, Phil. Thank you. Anything special in your glass tonight?
Phil (00:04:13):
Well, I'm having a fair life chocolate milk in my, my real science mug. But I wanna say some few things here about something I'd really like to be drinking, but it's a little bit too early to start with this wheky. I think it's pretty exciting that people are finding new ways to use dairy products. And one of them is whey, which we consider a waste product. And there's several distilleries around the country now making whey. This one's coming from California. This is from a wayward whiskey distillery in California. And they, it's called whiskey, not whiskey, because whiskey, whiskey can't be made from, from whey. It has to be made from grains. So it's a, it's a waste key, not a whiskey.
Scott (00:04:54):
Yeah. Excellent. Now, I understand that one of the professors at the university there is gonna be giving a webinar. Would you mind telling us about that and how they, how the audience can access that webinar?
Phil (00:05:06):
Sure can. It's actually not a professor from our school. He's actually someone that's been doing this in practice up in Wisconsin. His name is Curtis Bina from Copper Crow Distillery in Bayfield, Wisconsin. And it's gonna be Wednesday, May 15th from noon to one, but it will also be recorded if you can't make it at that time. But you can go to IA state.edu slash way and sign up for it. And you're gonna put a note in the, the show notes about it too, A link to it. So,
Scott (00:05:39):
Exactly. We'll put a link there in the show notes for everyone.
Phil (00:05:42):
Yep. I just think it's pretty cool that we're finding another use for for way.
Scott (00:05:46):
No, absolutely. Hope it helps milk prices as well. Anyway, but thank you for joining us tonight. Looking forward to great discussions myself. I'm having what I call my forever bourbon. I usually do this when I run out of bourbon. And what, what I do, I've got this very nice decanter that's shaped like a globe. And every time I get to maybe the last quarter of a bottle, I'll pour it in there. So it's always a little different and continues to change. And so, yes, I'm low on bourbon, and so I am getting like forever bourbon. And and with that, what I'd like to do is, you know, toast the dairy industry. Right, right. What a bunch of great people. And you know, I've been privileged to have a, a, a, a long career in the dairy industry, and I really do appreciate it. So here's to the dairy industry. Cheers.
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Scott (00:07:43):
With that, Dr. Vetter, let's jump right into it. As I, I've already stated that that was an amazing webinar, and I do once again, encourage everyone to go back and listen to that. Actually watch it because you've got a lot of great charts and graphs in there. But kind of give us a couple kind of key takeaways or key learnings or key key themes that you talked about during that presentation.
Kevin (00:08:08):
Sure. You know, so the majority of the presentation was talking about factors of impacting profitability. And, and I looked at data from a lot of places and a couple key drive home, you know, consistent points. I would argue across data points across time and whatnot. Or that those people that tend to be more profitable, they tend to be larger. Now that some people hear that and hear it the wrong way. It doesn't mean we're necessarily all advocating that everybody has to be really large dairy, but the reality is, is there's a lot of fixed costs and dairying, and those people that grown their operations tend to be ones that are surviving. But more importantly is also is diluting your cost by having high production per cow. So the successful operations tend to dilute costs by being a little bit larger than average and also more productive than average.
Kevin (00:09:00):
Now, just gotta always remind people we're talking averages, and there are exceptions to every rule, right? So sometimes people hear that message and they say, well, I know someone that doing something else. And so these are some pretty broad statements. But, so that's the key message is that, you know, you need to strive to always get better. The average over time is a moving target, right? Dairies go out of business, and that means there's more consolidation. So you always should strive for improvement. And that, I think everybody already knows that, but constant striving to improve is pretty critical in the dairy industry as well as many industries.
Scott (00:09:41):
You know, one of the things that I kind of had trouble getting my mind around is, zero profits. You're saying that, you know, it's a very competitive industry. And help me get my mind around that to talk about that for the audience.
Kevin (00:09:56):
Yeah.
Scott (00:09:56):
What do you mean by that?
Kevin (00:09:58):
That's a good point. And it's one we get pushback on a lot. But if you remember, I kind of threw in a number of weasel words. I said, profits are equal to zero on average in a competitive industry in the long run. So we know that some people are consistently better than average. But the more important thing to recognize is when we say average profits are zero, we're actually including all economic costs. And when I say all economic costs that recognizes that all assets and assets can either be my skills or my capital, right? I own land, I own facilities, but I also have time. We're putting a charge on everything. So some people will say, well, I've been making money all the time, but in all honesty, they've maybe been making a lower rate of return on their land or their facilities or to their labor than what we would assign 'em as an economist. So remember, when we say economic profits, we're charging for everything and we're charging what we think are opportunity costs of whatever that could have earned somewhere else. So that, and that's what a lot of people don't really factor that part in.
Scott (00:11:15):
Okay. That makes sense. Now, okay, let's say we accept zero is okay. Now, many of the last few years though, you've got a slide in your presentation that shows that we've been less than zero. So can you talk a little bit about that and, and, and, and how we're gonna get out of that?
Kevin (00:11:36):
We're probably not gonna get outta it. Now, I gotta be careful now because some people will hear it the wrong way. So once again, even though we've been below zero on average, we know even in the last few years, I suspect there have been people that are making money, right? Making money. So once again, we always have to remember averages. And we have been on average losing dairy producers year over year consistently for 50 plus years, right? And, and the point I made in the webinar is that for the most part, people don't go out of business, I don't believe. If they're making money, they go out of business at some point because the next generation doesn't wanna come back because they don't feel this is an attractive place to be employed. So they, for they go somewhere else. And so the fact that we consistently see fewer and fewer farms from year to year kind of reinforces that that average person is not making money. That doesn't mean that there's not people individually making money. There's people that are doing very, very well and they'll be around. It's just, it's a moving target, right? So what was better than average last year? 10 years might be below average. So those are, those are concepts. And, once again, I keep hitting on this, it's on average because some people use it and they take it personally and it's not, not intended that way.
Jim (00:12:59):
It, and, and maybe to help me 'cause I deal with the producer side, is it, is it the idea that the industry is a, is an average of break even, or is it even the individual operations are break even? And if, if it's the operations, is it more important what they do with their profits when they make them, to keep them above average? That's a good question.
Kevin (00:13:34):
So yeah, they're all gonna be good questions, and we just gotta hope that once in a while we come up with a good answer. If I'm a successful operate dairy producer, so let's say that routinely because of my management, because of how I've got my cost structured, whatever it is, I'm realizing a 15 to 20% rate of return if I make profit, what should I do with that profit? Well, I could invest it in the stock market. I could invest it in a subway sandwich shop. Or why not invest it back in myself and grow my operation. If I can get that kind of rate of return, maybe my best alternative use for that profit is back in me, in my company. And that's what we've seen a lot of, right? As we've seen a lot of consolidation and people growing their businesses, that's usually a pretty good sign.
Kevin (00:14:24):
Not always usually a pretty good sign that that's a very successful operation and they grow because they were exactly making profits. When we see some of those individual operations that for the last 20, 30 years have not grown, hopefully if, if they were profitable, they better be able to show that there's some other assets out there that they've been investing in. And if they can't really show us that, that tells you they're really not profitable, they're just, they're just kind of breaking even because they're not able to grow their business or invest money profits out outside their business.
Jim (00:14:58):
Okay.
Scott (00:15:02):
So Phil, I'm gonna throw this to you. In your experience as you look at that, at the farmers that are profitable and, and ones that are, are, are less successful, how would you characterize those differences?
Phil (00:15:14):
Those successful ones emphasize efficiency and making sure they out their maintenance cost really well. And then have everything going really well. Fine tuned, right? You know, the feed's always pushed up. You just always see the bunks full of feed. The, even the, the stalls full of bedding and then the time budget of the cows just they are, are usually spot on. It's they're just very efficient places.
Jim (00:15:45):
A client, I won't mention, but in California, and years ago, he was kind of a co-manager of two operations. And, and this fits how you described it. One always exceeded the other same ownership. I was doing diets, so diets would be similar. So I asked the manager, I said, what's the difference at this point, it was between 85 pounds of milk and 90 pounds of milk. And his answer was so simple and clear. He said, to get 90 pounds of milk, that'd be a hundred a day or whatever. He said, everything matters. And, and that kind of separates those herds. A dual K versus the ones we all hear about that are a hundred pounds of milk or, you know, a 70 pound jersey herd. It's, everything matters. You can't be tolerant of stuff, I think is how I, how I interpret it. Oh,
Phil (00:16:39):
I think that's right. That's something you're looking at, at the right economic indicators too. So, like Kevin brought up in his talk, if you concentrate totally on saving money, you don't do very well. Yeah. But if you look at return on how much it costs to make a unit of milk or income over feed costs, that's what really matters. And I think my clients that have done a good job doing that have been more successful than those that okay. That, that don't.
Jim (00:17:06):
Yep.
Kevin (00:17:07):
So a couple things I'd like to just interject there, Scott, real quick, is I've worked with different benchmarking groups with a lot of different industries dairy custom harvesters and whatnot. And, and everybody always would love to know, what's that one silver bullet for? What do I just need to do to be profitable? And what, what we just heard from Phillip and Jim is exactly right, is it's, it's all the little things done right and done consistently that often are the one thing that makes a difference. And that's, that's not an easy answer, right? Just says you gotta do things right every day. And some that really comes down to management and Yes. You know, so that's a big, big issue. Now, the one other thing I wanted to point out is, when you first started this question, we, you mentioned the word, and it, you probably rephrased something.
Kevin (00:17:59):
I said, I wanna correct myself when we, I don't want us to say you have to be profitable and make a lot of money to be successful. That is a very subjective decision, right? Okay. There are people today that know that they could probably be making more money if they took a job in town, if they sold their farm equipment and invested in something else, but they're doing something they really love doing, you know, they're putting food on the table. So I, I don't ever wanna have people realize or think that the only way we can measure success is by a balance sheet. 'cause There's a lot of, a lot of other things that are very important as well.
Scott (00:18:38):
Yeah, no, absolutely agree. A hundred percent makes total sense. You know, it's kind of a concept I apply to my life, right? It's, you know, a successful life isn't one where you make a lot of money. It's where you're a good husband, a good father, a good, you know, community member. All those things are very important. So yeah, you're, you're singing from the same song book. So appreciate that. You know, a couple things that, that I pulled from the webinar that, that, you know, you talked about and you said it today, the income over feed costs, there's always pressure to reduce feed costs, but yet you found that on average low feed costs is not an indicator of, of higher profits. Can you talk a little bit about that? And, and, and I'm sure it goes back to, you know, diluting your fixed costs, but maybe talk a little bit about the, the, the numbers that you came up with maybe how, how you came up with those numbers, maybe the research project that you used.
Kevin (00:19:39):
Yeah, it is like that. It's, it's always tough because as economists, we always get accused of saying, well, you assume this, you assume that. But the reality is, we have to make some assumptions on some things. And if I lower my feed costs, now I'm gonna make some broad statements and we can come back to 'em if we need to. If I lower my feed costs and production is negatively impacted, likely that was not the right thing to do. Obviously, if you can lower your feed costs with no negative impact on production, that's a great thing, right? I could lower my feed costs and still maintain the same level of income you'll win. But what I find is, if you view people in, in operations over time that try to start saving money, production is hurt, and then it's a spiral down.
Kevin (00:20:30):
But once again, that's not the case all the time. I'm currently, and this actually was the result of the webinar, if I had someone reach out to me and say, can you help me think through doing some of this pen move type analysis? And there definitely are times when lower feed costs doesn't necessarily hurt you because the cost savings might be bigger. Well, not they, they could be bigger than the reduction in income. I guess the main point is don't automatically assume that lowering cost is always a good thing. Don't necessarily assume it's a bad thing, right? It's very case by case. Depends on what stage of lactation. It depends on a lot of things.
Jim (00:21:06):
When I've dealt with feed costs now for, for 20 some years, and I'm a little slow on the uptake, but in the past five years it really clicked. All feeds are, we're not buying feeds, we're buying nutrients. And you know, this substitute, well, it's $50 a ton cheaper. Okay, well, there's probably a reason why it's $50 a ton cheaper. The market knows what nutrient costs should be. And, I've found that if somebody's got a spot where they, I need to cut costs for just, just for three months. Usually we can get by and cows will do fine. But, but there's herds that have cut costs, cut costs, and, and now they're a year into it and we can't turn that switch back on, to get the production back in a matter of days. It, it's, it's gonna be months and stuff. So that's how I view it. Does that make sense? I mean, Phil, you dealt with it in California as well.
Phil (00:22:10):
Yeah, no, that makes sense. It's hard to get, it's hard to turn the switch back on, but it's hard as a consultant though, to come up sometimes and know which products to add and which ones to, to take out. And it's, and you know, it's up to looking at the science behind the products and the, and our experiences with them to help make those decisions on those.
Jim (00:22:30):
Yep.
Phil (00:22:30):
Kevin, I, so this is kinda on the same topic here. I have some clients that really like to raise their own feeds, and when I tell 'em that you said that's a bad thing to do, they're gonna be mad at me. That's gonna bring that up. Can you clarify that? Can you clarify that a little bit? Because I don't think you necessarily mean that it's a bad thing to raise your own feed, but I absolutely do not.
Kevin (00:22:51):
I mean, I I, and I think even in the webinar, I, I probably shared that I'm using this one slide a little bit because it met my, my bias and my bias was not, and it isn't, it isn't to say that home raise speeds is a bad thing, that that's not what I was wanting to get. The point across, the point I wanna get across is don't automatically assume because you raised your own feed somehow, that's a lower cost. Most likely, in many cases, people think that way because they haven't put all the opportunity costs on what it costs them to produce that grain or that silage or that hay because, well, the land was already paid for, well, once again, if we factor in opportunity costs, that land could be used for something else. You could rent it out to somebody else, you could produce a cash crop.
Kevin (00:23:45):
So you really need to put the cost of that land at what it could be used for. And when you do all that, the cost of home raise feed probably is not that much different. So I'm not here to say that having a lot of home raise feed is a bad thing, and I'm not here to say it's necessarily a good thing. Now, if I can produce nutrients to, back to, to Jim's point, if I can produce nutrients more effectively and more cost efficiently on my own land, by all means home rate feed is gonna be a very good thing to do because at the end of the day, it's those nutrients that matter. But if I produce low quality feed on my own farm, I might be better off going out and buying it from somewhere
Scott (00:24:22):
Else. Phil, that, that was something that, that kind of caught me as well. And then I've kind of been thinking on a couple ideas I came up with. You know, it's easier to buy good feed perhaps than it is to raise good feed. Maybe that's one way to look at it. And, and then I'm wondering also, is there, is there an element in there where the, where it may be taking focus off of good dairying if you're focusing on raising good crops? And is it hard to do both? Right? just kind of curious your thoughts on that.
Phil (00:24:53):
Well, I was a veterinarian when I first started practicing. We used to call it corn planting disease and corn picking disease. Yeah. There'd be problems with the, on the dairies at those times a year because the concentration was on those feeds. But, but it makes a lot of sense to put it on those feeds. And, and I think because it's, especially corn silage, it's your one time of the year to get up most of the feed you're gonna feed that year. Most, most, most of the people we work with, even in California and here in the Midwest, I mean, the corns is king and it is a really good feed. And it, and it really is worth putting some effort into making sure it gets done well. So I'm not gonna argue with anybody that's put some effort into it.
Jim (00:25:29):
I, I view that as, as one of Dr. Vet's points early on, the larger operations can have a farm crew and can have a herdsman or a herd health crew that don't have to jump in a pack tractor that don't have to get in the silage trucks. You, you take care of the cows. You know, don't worry about the farming side. And that's operation dependent.
Kevin (00:25:57):
Yeah. Yeah. I mean, that's a good point, Jim, that, I mean, that's just another potential advantage of a larger operation, right? They have a core group of employees that can specialize. Yep. And unfortunately, and I said I, this is not intended to sit and talk about large versus small, but the smaller operations, you're doing it all by, I mean, kind of by necessity, you're, you're planting the corn, you're, you're taking care of the cattle, you're freshening cattle, you know, so it's that that larger operation allowed labor specialization if you want. And that's one of the reasons why I think they tend to be more productive. I, I did have a, a dairy dairyman tell me one year, and this was quite a few years back, it was a fairly decent sized dairy, but they were growing and the manager told me, he said, we own a bunch of our land here around the dairy, but we've made a conscious decision to go ahead and just rent it out to some local farmers and then we'll buy it back. Yeah. But we're not necessarily good farmers. We think we're pretty good dairymen. And I think, and I know they are, and his comment was, we need to specialize in what we're good at. Now. They even had their own land, but they actually rented it out to somebody and didn't turn around and bought the grain back from them.
Kevin (00:27:18):
There's a lot of dairymen in the US that would probably say that's, that's, you just don't, why would you do that? But they were recognizing their strength and saying, our weakness is, we'll get someone else to help us out. With lot
Phil (00:27:29):
People made that decision on growing their calves. Right? They send their calves off to a calf ranch because, is that what you're gonna say, Jim?
Jim (00:27:35):
No, no. I was gonna get custom harvesting people, but with a similar concept. Do what you do best.
Phil (00:27:40):
Yep, yep.
Scott (00:27:42):
Yeah, great point. You know, kind of taking a little different track here, I'm kind of curious saw the data and all the discussion spin around the US. Have you done any comparison with the US dairy economics versus other geographic regions around the world?
Kevin (00:28:00):
I have not. You know, the one thing that we'll see once in a while is when you see some of the statistics out there, they talk about how the US dairy industry can probably produce milk is cheap or as low cost as most places. The one place that, at least in the data I've seen from time to time that always has an advantage over us is places like New Zealand.
Scott (00:28:24):
Right?
Kevin (00:28:25):
That's nice. 'cause They have a very,
Scott (00:28:26):
About that one
Kevin (00:28:27):
Way, way less capital intensive. But when I did see the one analysis and I started digging into it and asking questions, they were putting a minimal or no charge on land. Well, of course, if you take your biggest asset or your biggest expense and you don't charge for it, you're gonna look pretty good, right? Yeah. So I think we need to make sure that we're talking apples to apples when we make some of these comparisons. But the little bit of data I have seen is US dairy can is competitive with most places
Jim (00:29:01):
On, on the business side as a vendor. Are you guys able to handle if, if or or, or comment on those things that, well, we've, we've found this market to be a little more stable for more years or, or anything like that on the supplier side?
Scott (00:29:22):
So I don't know about stable. I can tell you that, for the most part, for the kinds of products that we sell as a vendor tend to be high end micro-encapsulated nutrients. And those are for, you know, pretty technical cows or what, what we call ified. We find that the US dairies are far more accepting of those technologies than than other regions. Not sure why dairy husbandry is different in all those regions. I can tell you, New Zealand, Australia, where they're heavily pasture fed, don't use any kind of ingredients. In fact, that's almost a badge of honor, right? They tend to be low input, almost no input. And, and so they really don't even wanna listen to it, quite honestly. So, and, and we find it a little more difficult.
Jim (00:30:17):
Okay. And, and the two of you, you know, Philip, you had a pretty illustrious career with Elanco, et cetera. Are, do, does Elanco view those markets differently?
Phil (00:30:31):
I'm not sure I'm in a position to talk about that. 'cause I never really worked outside the United States. Okay. Very much, but yeah. But they are viewed differently, right? I mean, the economies are a lot different, right? Like we talk about New Zealand and Australia being pasture based, and there's parts of the world where the herds are very small and, and just the economics are different.
Jim (00:30:51):
Okay.
Phil (00:30:52):
For that reason. Yeah.
Jim (00:30:54):
Okay.
Kevin (00:30:55):
Yeah. Unfortunately, I'd probably be the same. I can't comment a lot because my experiences, you know, within Lanco outside of the US has been very, very limited. But the other thing that comes into play is across the, you know, globe, the product mix varies quite a bit, right? So some of the things that we might be having here in the US aren't even what's being marketed in other parts. So I just don't have a good feel
Jim (00:31:16):
For that. Okay. That, that's maybe kind of what you were getting at Scott too. It's, it's, each market has different expectations, so probably can't use that to say they're a stronger segment or a stronger industry. Right. Okay. Okay.
Scott (00:31:30):
You know, and I, I would add that that, that some of the more technical cattle, whatever region they're in on the larger dairies that kind of mimic the US dairies, they tend to be more open to you know, technologies like what we have more so than perhaps some of the others. Yeah. You know, kind of another tangent I was going to take is as you look at economics, right? There used to be that we were getting paid, I think more for the protein in the milk. And now it's much more for the fat. And I'm kind of curious if you've got any have, have you taken a look at that from an economist perspective?
Kevin (00:32:13):
I haven't. One thing I said, the day I started working for Lanco is if you guys want me to understand the milk market, I find someone else because I don't have that many years of my career left. But no, but, but if you look at what the long term trends, and not even just the long term, even the last five to 10 years, for sure, if you look at what's happened with components in the nice thing about when all of a sudden things are tied more to fat, the nutritionist, you know, the kind of work that Jim's doing, and they respond, right? Whereas with protein, there's a little less things we can do, you know, genetically we can still work there, but management wise, I think we've got so much more opportunity. You know, when, you know, 10 years ago, would you have ever thought of hearing the Holstein herd averaging a hundred pounds of milk at four point quarter percent fat?
Scott (00:33:07):
No. No.
Jim (00:33:09):
Mm.
Kevin (00:33:09):
I'm not saying that's typical today, but we sure hear of those, right?
Jim (00:33:13):
You hear, yes, that herd exists.
Kevin (00:33:14):
That’s it, that's a genetic thing, but it's also a lot of management. So the good thing from a producer standpoint is as that's become more important for my prices, there's more things within my control and my consultants that are helping me that we can now help and manage and economically take advantage of. So I, from that standpoint, I think it's been good. And, and the market has clearly shown that they have responded. If you just look at the trends in butter fat in the us
Scott (00:33:43):
Yeah. Without a doubt. You know, the other thought I had relative to that, and this, this might be off the wall, but, you know, fats got far more calories in it then does protein. And, and so it's gotta be more expensive to make that butter fat. Right? And so I'm just kind of curious, what role is all that playing in, in feed costs and economics and I, I don't even know if Jim, is that even a consideration or have you looked at that from a, from a practical perspective on your dairies?
Jim (00:34:15):
Yeah, yeah. We, we do. And actually I think I'd say it's pretty regular. And, and even if, you know, milk fat wasn't as valuable as it is, you know, the past few years with butter consumption making milk is an energy function. It is really outside of water, I believe it's probably the most limiting factor on most operations. Whether it's an intake problem, pushing up feed, like Philip said it's energy drives the system, and we definitely pay attention to that. And on the feed costs, I don't wanna say we, we ignore the cost of, of that energy, but, but if a herd wants to be a hundred pounds of milk and a four, two fat test and a, you know, a three, three protein or, or whatever the number is, it's going to be hard to do that on an inexpensive basis. It's just there, it's hard to get that done today. Yeah. And, and that involves feeding some of those fats that are probably a little expensive to get in front of the cow. Yep.
Kevin (00:35:24):
Yeah. But this is that classic place where maybe you have to spend money to make money. Yep. I said maybe, but it's always a fine line. That's why people hire the, the gyms of the world to help 'em make that decision, because there's some point where it quits paying for sure. Right? Yes. But in the, but there might be a place where I could spend more money, get higher fat, and that is definitely a profitable thing to do, but it, you can't keep doing it forever. It's gonna start tailing off. So, you know, I mean, once again, why we have to make this decision case by case.
Scott (00:35:55):
Yeah. It might be an unfair question, we're gonna ask you guys to kinda look into your crystal ball and do we, do we see this changing? Is there always gonna be an emphasis on fat for the next 10 years? Is this the new, the new normal? With, with, with, with milk protein being lower? I think it's almost all time lows now, at least since I can remember. Is this something we can expect going forward?
Phil (00:36:22):
I don't know. I think maybe it'll swing back and forth occasionally. The if you look at the protein markets, it's been up and down. I mean, it's down now, but it has been just few years ago. It was fairly high. Yep. And I'm hoping that things like this easy find new ways to make way more valuable from the sugar that's in it, maybe it'll help get the whey proteins out there and more people using them in other, other ways too. So
Jim (00:36:50):
If you say 10 years, okay. That's almost like saying always in this market, you know, never and always just, just really don't fit. And I, I'd say in the next 10 years, I'll bet you protein gets more valuable to own than fat. Yeah. Just the cycles.
Scott (00:37:13):
Yeah.
Kevin (00:37:14):
Yeah. I would, I would concur is that I think sometimes we all have a tendency to have this, what did I see recently? And we, we, have this recency effect. Yes. Oh, this, oh man, this is the way it's gonna be. It's like the market almost always comes back and reminds us that no, we adjust and we change over time. So I, yeah, I, I think we'll see things swing in both directions going forward. I just can't predict when, if I could, that would help.
Jim (00:37:40):
Kevin, could you go back to, sorry, Scott. The in, in the webinar as well as some other conversations that we've had kind of go over that the, the value of calling or the, the impact of calling and those, you know, sending a cow to market or what's her what should be considered when we go to replace her, you know, those kinds of economic decisions.
Kevin (00:38:10):
So just, we got another three hours on this webinar, you know, I mean, you, you know, that's a loaded question because it's art, right? And there's so many parts that come into play, and I, I'm gonna take a step back and compare it to something that I think is a little bit similar to when I was at Kansas State, we used to get, people would ask us questions. This was not related at all. We get people asking us questions about leverage on your farm. And they'd say, well, it should, how much debt should I have? And is that a good thing or bad thing? And when we go back and observe data, you know 10 to 20 years of data from farms, because we had a really good database at Kansas State for crop farms. What we found was leverage oftentimes was a good thing or a bad thing.
Kevin (00:39:03):
Okay. And by that I mean the people that could get that 15 to 20% rate of return on their money because they were a good farmer, the best thing they could do is go borrow money if they could borrow it for four, five, 6%. Unfortunately, a little bit higher today. Yeah. Because they were leveraging it. Right? On the other hand, someone that could get a four, 4% rate of return on their money and was paying the bank six, they were going backwards on every dollar. They, and what would happen is they just fall further and further behind. So when you observed them after the fact, you saw that those people that were the least economically successful had high debt. Okay. Those that were the most economically successful had high debt. Okay. I think culling is the same thing. I think we will go back and we'll see herds that have tremendously successful operations, that have very low cul rates because they can, because they have very healthy cows, they're really well managed.
Kevin (00:40:05):
They do all the little things right. They go ahead and they start breeding with more sex semen, more beef semen. They produce soft heifers because they don't need to replace Mm-Hmm.
Jim (00:40:54):
No, no, I appreciate the way you took that. And, and I think it's also a matter of, each operation and then each calling decision are very individualized. Is that how you mean it?
Kevin (00:41:12):
Oh, very much so. Very much so. Yes. I mean, I, I, I would never wanna go onto a dairy and have them say, what's the cut rate I should have? Now if they tell me that we are doing a really good job with all the little things, we have healthy cows, we can get cows pregnant in a timely fashion, and we, they're doing everything right, I'm gonna say you should choose for 30% or less. I think that's, if it's attainable, that's probably your best thing to be, that would be the absolute worst thing for me to tell somebody that is struggling. And they keep a bunch of cows that are way past their prime, but they can't sell 'em because they don't have a replacement to come into their place. So once again, it's a very individualized decision. Ev everybody wants that silver bullet. What's the right answer? And the right answer is a lot, lot more complicated, obviously.
Phil (00:42:06):
Okay. There are some interesting tools in some of the software, like PC DART has a thing called keeper beef, and dairy comp has cow valve, which I think, I think both those tools are kind of underutilized and not used enough and help make decisions. 'cause It's looking at the slot for that cow and whether it makes sense for her to be there or whether it's better to have a replacement for her rather than just a whole overall number. So could each, each one individually,
Scott (00:42:33):
What, what are the factors that go into making that decision in those programs?
Phil (00:42:38):
Well, that's way above my pay grade on that. Okay. Question. But the big things are the milk production of that cow, and whether she's pregnant or not, those are two of the big things that make it and how old she is, how likely she's to be around whether she gets cold or not. So just naturally there's lot, lots of factors that go in on, on both of those, but, and then the computer calculates the, essentially a value for that cow based on those information, that information.
Kevin (00:43:06):
The I, I'm not familiar with the, the keeper beef one, but the cow valve, one of the, I mean, let's recognize when this was developed, right? It was developed a long time ago. And at that time, initially nobody thought about components. So now they have tried to make some adjustments to account for components because that's very relevant, right? Not just milk flow, but Mm-Hmm.
Scott (00:44:01):
Kevin, do I understand it correctly that part of your job is you'll go onto dairies and you'll, you'll evaluate them and, and consult with dairies in helping them prove their, their economics?
Kevin (00:44:17):
Yes and no. Still smiling?
Kevin (00:44:23):
Yes, for sure. But sometimes it's not in the same way as you think, because it's very seldom really looking at a lot of financial and economic information. It's usually geared very much around production. But as I've said, and I think there's a lot of data that backs it up, high producing efficient animals, not just necessarily the highest freezing, but they gotta be efficient. That usually ties in very closely with economics. So a lot of the work I do looks at things that are driving milk production, repro and removals. I mean, those are the three big drivers of economics, right? So yeah, I do that now. I have a limited amount of time, so I'm not gonna lie that, you know, good customers get first dibs on me, you know, because I can't be going everywhere and anywhere. But yeah, that is what I do and it's what I love to do.
Jim (00:45:14):
Okay. And, and, and I've seen some of those and, and I'm glad you brought it up, Scott, because I, I didn't know if we wanted to go down that path, but, but one of the things I've seen on a few operations has been if I could pick a day to get an animal pregnant, what is that day? And, Kevin has, has done that. And, and I'd like to, to hear it again. It might be my third time hearing it so that it might sink in. What's been the value of that, Kevin, for heard you've talked to?
Kevin (00:45:51):
Well, one, I don't know for sure what they ever do with my information, but sometimes it's just confirming what they were thinking or it's giving them an excuse not to make a change. But, so the, the way this first came up, and it was working out in California with Philip, and you know, it was a question that's coming up every place in the country right now. The dairy said, look, our production has been very good. Everybody's production's been rate going up. The repro has significantly improved from 10, 15 years ago. So the question came to me is, maybe we should be trying to get our cows pregnant later because we're drying off cows at a lot of milk and it makes sense that we should just not even start trying is early. And that's how the question came to me. And I analyzed it.
Kevin (00:46:38):
And my conclusion has been, and this has been fairly robust across Holstein herds that those second and greater lactation cows, I come back and I say, no, get her pregnant as fast as you can and get her back to her next peak. And as I've been looking at data from different herds, pretty routine, I'm noticing in the data that of the herds I'm looking at, they're increasing their voluntary weight period. So I think the industry has been going to where they're saying, we're not gonna try to get our cows pregnant as fast. I'm suggesting that's maybe not the right thing to do based on, you know, an analysis of about 12 different herds that's not, I haven't done this all over the country, but the results on that sing herds were pretty consistent. Jim's familiar with the ones on some Jersey herds, and they were a little, little more mixed. But it's still, generally the conclusion is that for the most part, we probably don't wanna delay too long.
Phil (00:47:38):
That's mostly because of the, a lot of it's because of the persistence, right? The
Kevin (00:47:41):
Oh, exactly. And that's why the first lactation would potentially be a little different potentially. Yes. Yeah.
Jim (00:47:46):
And it's taken a little bit, it's been, it's been very helpful. The herds that I've been involved with that, that you did it on, one of the challenges to me has been to, to split that there, there's nothing wrong with a 90 or a hundred day voluntary waiting period on the first lactation animals, and maybe it, it should be 65 right. On the mature cows or, or whatever number they, they feel comfortable with. And, and I'm like, well, that's just, I think it's just codes in dairy comp or, or whatever it is. And like, why can't you do that?
Kevin (00:48:26):
So that is one thing that I can come into a dairy and say, here's my results that now you have to maybe implement if you're gonna make change. Because that's always a, a pushback a little bit is okay, it's easy to say, but now we've gotta manage changing cow flow and, and that I'm, I'm not minimizing it, but, but once you get to some kind of new static system where it's 90 on the 60, you know, I think that could work. Yes. But in the short term, it's gonna disrupt your cow flow a bit.
Jim (00:48:53):
Yeah. But it seems like it's worth doing it. Some have done it, but, but very often we do have resistance. I don't know of anybody who split them and has gone back. So I, perhaps they like it.
Phil (00:49:10):
I think one good, good thing that information is done for some producers is to get them off the idea that they really need to back it up and, and breed those cows at a hundred or 120 days. I think that'd probably been a mistake. And I think Kevin did a good job of helping that keep that from happening.
Jim (00:49:24):
Yeah. Yeah.
Scott (00:49:27):
Good stuff. Kevin, are there any key trains of thoughts here that we've not covered yet that we need to cover?
Kevin (00:49:37):
Well, there is actually something that's kind of related a little bit to me, I guess the decision on culling that I just literally had a email pop in here a little bit ago, as I saw on my computer. Someone asked me about finding the optimal age to cast that first lactation animal. And I think we've all been to conferences and we've heard different talks on this. And unfortunately the answer's the same as it was with culling, is you cannot have a blanket statement. Okay. Because I routinely look at that when I analyze data and I can look at one herd and I'll say, from a milk standpoint, I tend to focus on milk, but obviously repro and removals is relevant. But from a milk standpoint, I can work on one dairy today and say, you know, you should be calving your first, first lactation animals at 25 months.
Kevin (00:50:29):
The very next herd, I might say 22 and a half. It all depends on how they raise their heifers. Yeah. Right. And I mean, we hear people talk about it all the time. That's why I just, the point of this isn't that there's a right number, there is probably right number for your operation, but don't think just because my neighbors or my friends are at 23 months, that's where I should be. Because it depends on how you raise your heifers compared to them, you know? So same thing as culling is there's not one answer for everybody.
Scott (00:50:57):
Is there maybe more an appropriate weight?
Kevin (00:51:00):
Well then I think that's exactly, and I mean the guys, you know, Jim and Philip can speak that way better than I can. Unfortunately, most people can measure and quantify age 'cause they know when that animal is born. Yeah. They can't do so well on weight because they're not all weighing them as well.
Jim (00:51:19):
Let me ask Phil, let me follow up with a question then to Philip on that thing. You probably dealt with it probably, I'm almost positive you dealt with it, Philip in California with the, I'm gonna this calf program, I'm gonna get accelerated gains or optimum gains, whatever term you want to talk about. All they're gonna 1.9, you know, pounds before weaning and stuff, and, and that's good if that works. Yep. But then in California, very often my observation was, yeah, yeah, you gotta do that. Okay, now she's bred, make the diet cheap. And, and we, we gave up all the value. We still have the gain, but we gave up all the value. And now we do calves, probably undersized, maybe heavy, maybe over conditioned, but pretty small because she's pregnant. Just make it cheap. Did you see that some, Phillip?
Phil (00:52:19):
I did see that some, and it's sometimes hard to fight. So getting, we as nutritionists have to give pushback on that, and we need to go spend a little money on protein if we just feed 'em in California, there's, there's this little bit of misconception that it's, the byproducts are really cheap, which they are. But a lot of the byproducts that we feed, the growing heifers are really fairly high in energy and not that high in protein. Yeah. They're not quite good enough for milk cows, but they're really almost too good for growing calves on the energy side. And then we end up shorten those growing animals on protein. Yeah. And sometimes just gonna spend a little money, Kevin's talking here, this whole economics thing, spend a little money on protein, it'll get those animals bigger and a little bit stronger and they'll cal in better. But it's, you're, you're right. When people wanna have a dollar per day would cost to raise a calf, it's hard to go spend the money on that extra ingredient to get more protein in there, because that's one of the more expensive ingredients. Yep.
Jim (00:53:14):
Yep. Okay. Yeah.
Scott (00:53:17):
Well, Kevin you mentioned before that this might take three hours, and if that's gonna be the case, I'm gonna have to, I'm gonna have to get a little more bourbon here because I am out. If not, this might be a good, good place to call last call. I'm gonna assume the latter is from the afternoon.
Phil (00:53:37):
Can I ask Kevin a question?
Scott (00:53:39):
Yeah, absolutely. So,
Phil (00:53:40):
So one thing I really appreciated in what he taught me in California was about comparative advantage. And he mentioned it in his talk, but he didn't go into any detail on it. Can you talk about what that means and give an example in the dairy industry of where it might apply to us and how we should think about you know, where dairies are going to be or how we should advise dairies going forward?
Speaker 6 (00:54:03):
Tonight's last call question is brought to you by NitroShure Precision Release Nitrogen. NitroShure delivers a complete TMR for the room and microbiome helping you feed the microbes that feed your cows. To learn more about maximizing microbial protein output while reducing your carbon footprint, visit balchem.com/nitroshure.
Kevin (00:54:28):
Sure. So there's a reason I didn't talk about it on the webinars because I had way too much material anyway, but so the concept of comparative advantages exactly. Kind of what it sounds like, and how I bring it in initially, and I worked real well with Philip since he's from Iowa. As I said, how much wheat is grown in the state of Iowa? And the answer is almost none. Basically. None. Right. Does that mean you can't produce wheat in Iowa? Absolutely not. I bet you Iowa can produce wheat just about as good as Kansas, but they can produce corn a whole lot better. Right. So they might have an absolute advantage for wheat, but their true comparative advantage is corn. So use your resources in the best way possible. And where we've really seen that in the state of California, in the dairy industry is there's a lot of corn silage ground that's not in corn silage anymore. Why not? Where did it go? Jim?
Scott (00:55:29):
Trees.
Kevin (00:55:30):
It went to trees. Not that you can't produce really good corn silage out there with irrigation, but economically it makes way more sense to grow something else. So even though California might be a tremendous dairy state, to the extent that that water is better used on trees, at some point they lose their comparative advantage for dairy and that dairy could go somewhere else. So it's just all relative to where something could be done better. So California might have some of the best places to produce dairy, but if they've got better use for those resources, that dairy should go somewhere else now. And we've seen that to a small extent. And I, and I suspect over the next 10, 20 years, we'll, we'll see it more. They need then you throw in further complications of government compliance, environmental regulations, labor that comparative advantage California has had probably be, you know, moving somewhere else.
Jim (00:56:26):
Yeah. In, in the short term, it really looks like not that dairy's gonna come roaring back in California, but the, the tree guys aren't nearly as happy as they were Yeah. Three, four years ago. So just the, the price and, and I, I, I don't wanna get in too much 'cause I, I can't go the, I don't know the details, but apparently for years nobody in the world, the climate is too good. It's perfect for almonds and walnuts, et cetera, in California. They can't grow anywhere else. Well, apparently some other geography has figured out how yes, they can grow almonds. So the competitive advantage has been lost. Yep. And makes sense. You know, just the economic supply and demand. Yeah,
Scott (00:57:19):
Yeah. Makes sense. I'm kind of curious, Kevin, you were talking about competitive advantage and, and, and is there a geo geography today that has an advantage over the others where those dairies are gonna move to?
Kevin (00:57:35):
Well, Yeah. There's another economic concept that was on that same slide that I didn't also talk about and that's revealed preference. You know, so in economics we always, when we talk about revealed preference, what we're really saying is what the market's doing on average is probably right now there's individuals within a market that are making dumb decisions every day, but the market as a whole generally is probably correct. So all we have to do is look at what's been going on with cow numbers in the US and I think you can start having your answer there. You know, Michigan, South Dakota, we've got a number of states that have been growing. So that says that's kind of where that advantage is moving to. Or else it wouldn't happen, right? Right. Because the market on, on whole or on average is intelligent and the fact that we're seeing more cows in certain states says that's not, there's reasons for that.
Kevin (00:58:34):
Okay. Unfortunately, well, unfortunately in my perspective, others might argue with me, what's gonna drive it more and more in the future will probably continue to be environmental regulations and labor regulations. So, I mean, things that aren't necessarily related to producing milk and the cost of feed, it's gonna be more government intervention that either helps us or hurts us. And that's, I mean, that's the reality of the market, but, you know, it'll be a little less economically driven by true things we think about for making milk and more regulations and, and policy and things like that.
Jim (00:59:11):
Okay.
Scott (00:59:13):
Alright. Well, gentlemen, I think we're gonna wrap her up here. I'd like to leave with just, you know, one comment from each of you, you know, know whether that's a key learning from the webinar, the discussion today, whether it's advice for dairy farmers nutritionist I'll leave it up to you guys. What would be your final words? And Phil, I'm gonna start with you if you don't mind.
Phil (00:59:36):
All right. Well, I'm gonna take lesson I learned from Kevin A. Long time ago and reiterate in this in this webinar was on the not looking at the feed price the, or the cost per cow per day, but looking at the income per cow per day income over feed costs, I think it's one of the best ways to look at whether particular cow's gonna be profitable and look, and, and keeping the units on the price, on the, the, the denominator being the unit of stuff you're making, not the unit of stuff you're putting in. If you're making furniture, it's not the profit per chair. It's not the profit per log it's going in. So,
Scott (01:00:14):
Yeah. Makes sense. Jim, what comments and wisdom do you have for us?
Jim (01:00:19):
Well, I, you, you didn't have to throw in the wisdom part to that. Something again, similar to what, what Philip said in relation to listening to, to Dr. Vetter, others that were at the Discover conference and stuff in the fall on longevity. I think the, I, this may sound maybe I, hopefully I won't have to explain it. I think the importance of well thought out decisions for the dairies is becoming more and more important. It's, it's not, well, should I call this cow? It's a lot deeper than that. Whether it is a cow valve. It's the importance of understanding the impact of decisions that get made. For a long time we've done it with tractor purchases or whatever, but I, I just think the depth that somebody needs to have knowledge and stuff on making those important decisions is gonna be a driver for success in dairies. Yeah.
Scott (01:01:27):
Well said. Jim. Dr. Vetter, final word.
Kevin (01:01:32):
Okay. So I, I definitely wanna just concur with what Jim just said is that the days of being very successful with a lot of just gut field decisions, I, I think, are kind of behind us. There's just so much data and analytics now we have to make decisions based on the best information we can have. So I guess what I would challenge people to think about is really know your KPIs. Know what makes your business successful or not, and constantly strive to get better. Don't worry about what the neighbor's doing. Granted you're competing with the neighbor potential, but I mean, know where you're at and constantly strive for improvement because I think the dairy industry will continue to consolidate, will continue to improve. Don't look for the markets to bail out. Well, we could be successful if we just had 25 milk. Don't, you know, control what you can control.
Scott (01:02:24):
Yeah. Perfect. Great way to end it, gentlemen. This has been a lot of fun. I've appreciated this and really enjoyed it. A great way to spend a Friday afternoon. So Kevin, thank you for joining us and inviting Phil and Jim, you've been a great co host. I, and if you're up for it, I'd like to have you back sometime. So I, I'd really like to,
Jim (01:02:47):
Yeah, just, just gimme enough notice and it'll probably fit. Thank you, Scott. I was honored by the ask.
Scott (01:02:53):
Oh, no worries. You're quite welcome. So we wanna thank everybody. We wanna thank our audience as always for joining us here at the Real Science Exchange. We hope you learned something. We hope you had fun and we hope to see you next time here at the Real Science Exchange, where it's always happy hour and you're always among friends.
Speaker 6 (01:03:10):
We'd love to hear your comments or ideas for topics and guests. So please reach out via email to anh.marketing at balchem.com with any suggestions, and we'll work hard to add them to the schedule. Don't forget to leave a five star rating on your way out. You can request your Real Science Exchange t-shirt in just a few easy steps, just like or subscribe to the Real Science Exchange. And send us a screenshot along with your address and t-shirt size to anh.marketing at bal chem.com. Balchems real science lecture series of webinars continues with ruminant focused topics on the first Tuesday of every month. Monogastric focused topics on the second Tuesday of each month, and quarterly topics for the companion animal segment. Visit balchem.com/realscience to see the latest schedule and to register for upcoming webinars.