DYNAMIC OPTIMIZATION OF PRODUCTION TO MARKET CONDITIONS
Posted in: Economics, Pork Insight Articles by admin on May 12, 2017
Pork producers have been used to constant evolution in rapidly changing markets in order to maximize profits. Least cost formulation is readily used to minimize feed costs for a defined set of performance expectations. Does feeding pigs the cheapest feed always provide the best financial returns? Will feeding diets that minimize feed efficiency return the cheapest feed cost or highest profit? In some situations, yes, but in many cases not. Market conditions that swine producers operate in will continue to constantly evolve. In order to be successful producers will have to be aware of theses changing market conditions and dynamically optimize their shipping and feeding strategy to maximize profitability, not only daily gain, feed conversion or looking at the lowest feed cost per ton. To perform this operation, strategic utilization of integrated simulation models, with the capacity to optimize, can play a significant role in choosing the best strategy for the moment.