Post #2: Collaboration between animal health and feed industries
One of my favorite aspects of serving as a National FFA Officer this year is the time my teammates and I get to spend in meetings with agriculture industry leaders, most often as part of our virtual corporate sponsor visits. These visits give me a chance to take knowledge I've gained about the industry, whether through personal experience on my family's farm, my FFA Supervised Agricultural Experience where I raised and sold purebred dairy cattle, or college experiences such as the GFAI Industry Immersion Tour, and understand how it applies in the broader context of the industry and the influential players in it. One such visit, with leadership from Merck Animal Health, was heavily focused on systems thinking and how different sectors of the agriculture industry interact with one another. Some of Merck Animal Health's recent acquisitions--from customizable animal monitoring technology to environmental impact measurement tools--are indicative of the increasing collaboration and interconnectedness of the animal agriculture industry. One of the members of their leadership team shared how the animal health industry is no longer just focused on treatment, but also on the holistic process of raising and caring for animals. This idea manifests itself in areas like feed additives, but also points to stronger future ties between the feed industry itself and animal health companies like Merck. These shifts in mindset from influential agricultural players appear to be coming along parallel to shifts in consumer preferences, where buyers are increasingly interested in the environmental and social impacts of their food production processes. For animal health companies like Merck, it's an opportunity to collaborate with companies farther upstream, like those that process animal feed, to develop stronger lines of communication and ultimately provide more transparency and traceability in the supply chain. For many consumers, it's not enough to know where the animal product itself came from, but they also want to know what that animal's diet was, too. This is apparent with value-added products such as grass-fed beef, or vegetarian-fed chicken; it seems likely that forward-thinking feed companies will have an opportunity to reap more benefits while providing value that consumers desire in even more areas. One example is to identity preserve feed ingredients that came from farms with a focus on soil health, carbon sequestration, or biodiversity. Another is to utilize cover crops or more specialty grains that provide ancillary benefits to ecosystem service markets. Successful innovation requires meaningful relationships and strong networks; this is exactly what groups like GFAI provide for their members, as do organizations like the FFA. As an FFA member and a beneficiary of GFAI's student programs, I'm excited to stay connected and watch as the industry continues to progress, through increased collaboration between feed and animal health companies and beyond. Post #1: Entrepreneurship in the Grain and Feed Industry
While I have taken a gap year off of college classes in order to serve as a National FFA Officer, this role has taught me lessons far beyond what most classrooms can provide. The three-circle model of agricultural education consists of in-class instruction; leadership through FFA programs; and experiential learning--largely through what we call Supervised Agricultural Experiences--where students have their own project relating to agriculture, food, or natural resource systems. I'm especially partial to any aspect of experiential learning, and that's part of why I found so much value in the GFAI Industry Immersion Scholarship Program. Not only did we get to tour working facilities and learn from people who are out doing the work each day, but also we got to spend time job shadowing in those facilities for an even more in-depth learning experience. This spring, I've found myself in experiential learning scenarios that are more about thought leadership, industry-wide macro trends, and management; the time I spend in meetings with C-suite leadership of international agriculture corporations, however, is made more valuable because of the time I've spent on the ground with experts in the field, like those I met during the fall semester as part of the Immersion Tour and job shadowing days. One of the most fascinating meetings I've had so far in my role as an FFA officer was with a leader in Syngenta's global biological products division. We talked about his focus in the area of new innovations through biological crop inputs that serve as one more tool in a farmer's toolbox, but we also covered some of the current trends in the agriculture industry as a whole. One of the most interesting, to me, was the increasing importance of the entrepreneurial spirit. Much of the innovation that is occurring in agriculture is now coming at the hands of small start-up companies rather than the large, often multi-national, well-known companies in agriculture. Those larger companies, however, aren't missing out on the action; many have investment portfolios of their own, where they invest dollars into potential future acquisitions and are simply able to learn more about these emerging technologies. It also seems that hardly a week goes by without reading another email newsletter about a start-up acquisition in the agriculture industry. This trend has significant implications for both well-established players in the grain and feed industry as well as young people like myself who are seeking to find our place in it. From how I see it, there are two distinct ways to play a role in grain and feed industry innovation: we can either be the kind of person who begins or works for a start-up, or we can be the kind of person who works for the larger company that will ultimately purchase and scale up the innovation created by the start-up. Either role requires somewhat of an ability to think independently and creatively; this is the type of thinking fostered by experiential learning that both the FFA and the GFAI student programs provide. This semester I spent two days shadowing at Advance Trading Inc. in Bloomington, IL. ATI assists grain sellers and buyers in managing their risk through hedges in the futures market. My first day at ATI this year fell on the day the monthly USDA report came out. In the brokerage world, this is an important report because trading prices can be heavily affected by its predictions, although the impact of the report is greater in some months compared to others. When the report came out I was sitting with Nathan Mangold and watched as prices fluctuated wildly. This was a great insight into how the markets can change on a whim and how important it is to react correctly as a commodity trader when these reports come out. My second day came this past week and I spent most of my time with Curt Strubhar, a broker who mainly serves commodity buyers such as elevators and ethanol plants. The first hour was spent listening in on calls to clients from various regions of the country to discuss recent market activity and potential trading strategies going forward. Most farmers are busy planting here in central Illinois so this is a good time for brokers to formulate strategies before the crops are above the ground. Over the next hour, I met with two brokers who specialize in helping farmers manage their risk when selling grain. Key decisions in a farmer’s risk management strategy include whether to sell or store grain at harvest and which option stances to take in the futures market. To finish up my day, I again met with Curt and joined him on a video call with a couple other ATI employees and new investment company in St. Louis. The main topic of discussion was the soybean meal and soybean oil markets and how prices are determined for the different regions of the market. These markets are largely impacted by a value called crush, which is the difference in value of soybeans and its byproducts. The ratio of contracts to maximum daily crush can lead to a discount or a premium on shipments of these two commodities if the ratio is outside of the established range. It was a privilege for me to sit in on this call because it is a unique service offered by ATI, as they were helping a firm that doesn’t specialize in agriculture to become more familiar with the industry so that they can become more involved in it.
Grain and Feed Scholarship
Kyler Masching Hello again, my name is Kyler Masching, and I am a Junior at the University of Illinois studying Agriculture and Consumer Economics with a concentration in Agribusiness- Markets and Management. I also am completing a minor is Crop and Soil Management. I was able to be paired with Consolidated Grain and Barge at the Dwight, Illinois location for my job shadow. I really enjoyed being able to job shadow here, as I was able to learn about the company as well as the basics of grain trading. The merchandisers, Sam and Kevin were able to explain to me the different pricing options that customers have when selling or delivering grain to CGB. These pricing programs are great for farmers that are attempting to sell their grain ahead of harvest and for farmers who think the market might have some upside potential but want to reduce their downside risk. One of the days I conducted my job shadow during the Spring of 2021 was on Wednesday, March 31. This was a very exciting day to observe the markets because the Prospective Planting Intentions Report was scheduled to be released from the United States Department of Agriculture (USDA). In the morning, we discussed how large of an impact the Prospective Planting Intentions Report could have toward commodity prices as the number of projected acres being planted directly relates to the supply side of commodity grain prices. We discussed the acreage projections of other firms in the market and how these projections would compare to the USDA acreage projection numbers. Then at 11am, the Prospective Planting Intentions Report was released, and the market began to react to the Acreage Projections. The commodity futures market quickly jumped up toward its maximum price move in one trading session, which is called the limit price. At that time, the limit price for corn was $0.25 and the limit price for soybeans was $0.70. Both corn and soybean increased prices to their limit that day, moving corn upward $0.25 per bushel and increasing soybean prices by $0.70 per bushel. On my next job shadow day, I met with Larry Ketcherside who is the facility manager at the Dwight Consolidated Grain and Barge location. He explained to me what his daily roles and responsibilities included and that his roles can change based upon the day. He showed me the various Excel spreadsheets he uses to help organize and track grain while it is at the facility. He also explained the aspect of his job which includes planning for the future and ways to help make the facility more efficient. Another important role I was able to observe and help with was the probing of grain trucks as they would enter the Consolidated Grain and Barge facility. Probing is an important action the elevator takes in order to know the moisture content and the quality of the grain is it receiving. After the trucks are dumped the grain is monitored inside of the grain bins by cables that track the moisture and temperature of the grain. By tracking the moisture and the temperature of the grain, the operators at the elevator can ensure the grain is keeping its proper condition for when the time comes that the corn and soybeans will leave the facility. I would again like to thank the Grain and Feed Association of Illinois for this scholarship opportunity and to Consolidated Grain and Barge for a great job shadow experience. I was able to learn many interesting components about the grain industry through the Industry Immersion Tour and through the job shadow experiences. As a Grain and Feed Association of Illinois scholarship recipient, I was given the opportunity to have great job shadowing experiences over the last few months. For my job shadowing experience, I was paired with The Andersons grain facility in Champaign, IL where I spent four separate days with the companies Regional Sales Manager. Each day that I spent at the Facility was unique, which was exciting and allowed me to learn about all aspects of the company. For my first visit I went to the facility during the mid-harvest season. We spent the day discussing the odds and ends of how the facility operates and touring the entirety of the facility. Mid-harvest is one of the facilities busiest times and it was very insightful to witness how operations were handled throughout the facility at this time. My next visit was during the winter and I met with the company’s operations manager. I really enjoyed this experience as his position was very relatable to the future job I wish to have. As a Technical Systems Management Major at the University of Illinois, seeing how all of the operations of the facility were handled was of great interest to me.
My spring job shadows were also unique. I learned how the company has many different aspects that are incorporated throughout different times of the year. In my two spring visits, we spent a lot of time discussing the different groups of the company and how they all work together to achieve a common goal. I also spent time learning about how the commodity markets work. Before my experiences at The Andersons, I had no idea what the scope of an elevator really entailed and thanks to the wonderful people that took the time to meet with me I now have a much better understanding. I am very thankful for the opportunities that the GFAI scholarship foundation provided me, and I would like to thank everyone involved in the program and also those facilities that generously gave their time to provide such great job shadowing experiences. For my Spring 2021 semester job shadowing experience, I traveled down to Henry, TN, and spent two days learning from Caleb Haywood at Tosh Farms. Tosh Farms is the largest pork producer in Tennessee and the 30th largest pork producer in the United States. Caleb is the Grain Manager for Tosh Farms, he manages the 18,000 acres of land, which is half-owned by the company, and then the other half is owned by 83 different landowners. They grow seven different crops on this land: white corn, yellow corn, soybeans, milo, wheat, canola, and barley. Caleb will buy grain from any local farmer, typically within a 50-mile radius of Tosh Farms, for the right price. Caleb is willing to buy any grain a farmer wants to sell to him because he sends that grain to their feed mill and any surplus he sells at the nearest river terminal. Tosh Farms, Henry TNTosh Farms has a separate company called Tosh Pork. The feed mill at Tosh Farms sustains their 35,000 pigs spread out across various farms in TN. Tosh Pork provides care for around 36,000 sows producing over 850,000 market hogs each year. Tosh Pork operates by seeking out contract farmers that can operate either a sow barn or wean to finish barn. I got the opportunity to speak with Caleb on how COVID-19 affected their pork operations. Caleb said because the pork processing plants had cut down their demand by nearly a quarter of what they had been selling at the market pre-covid. They tried every measure, such as raising the temperatures and cutting all of the energy out of their pigs. Despite these measures, they were forced to liquidate one sow barn. They are still recovering from this major setback. I also had the opportunity to receive a tour of all the facilities with Caleb. We walked around the property, and he showed me the different styles of grain bins, scales, unloading areas, feed mill, and by-product building. The most unique part of the tour was the by-product building. In this building, you have mounds of ground-up by-products going to go to waste and that Tosh Farms receives from different companies and then mix into the pig feed. These products include dog food, peanut butter, chip bags, and rice. Incorporating these by-products into their pig feed can save millions of dollars on soybean meal a year. Hello, my name is Morgan McCarthy, and I recently graduated from Southeast Missouri State University this past December while studying Agribusiness. I am from a small, rural community in Monroe County known as Valmeyer, IL. I am extremely grateful to be one of the 2020 GFAI Scholarship Recipients as it has not only helped me financially, but it has also expanded my understanding of the grain and feed industry in our state. I had the privilege of shadowing several individuals at CGB, Inc. in Scott City, MO. I was already slightly familiar with the company and this location because I worked part-time for them during my junior year of college.
My first two days at CGB I job shadowed one of their grain merchandisers and fellow SEMO alum: Lenice Jensen. Lenice was extremely kind to me as I was trying to pick her brain about her roll at CGB. She explained to me how her career started with a grain merchandising internship with CGB when she was in college. She absolutely loved her experience and decided to accept a full-time merchandising role not long after her internship. She has been a merchandiser for CGB for about seven years now. I started off by asking Lenice what she does during the middle of December. She explained to me that she receives a lot of calls from her growers who are wanting to sell their grain that they have been storing in their bins. During this time, she also calls her growers to get an idea of how many acres they want to plant for the 2021 growing season. She also purchases new crop for 2021 from her growers who are ready to sell. The main crops that Scott City takes and the merchandisers purchase are corn, soybeans, wheat, and a little milo. Lenice said that the main contracts she works with are priced/cash contracts, basis only contracts, and futures only contracts. This time of year, she was also promoting CGB’s PMP (Professional Managed Pricing) Program which is a grain selling program where marketing professionals determine the best marketing strategy for growers. To participate in this program, growers agree to a contract that states they must pay CGB a certain fee per bushel that is put into this PMP program. Lenice said that growers normally put a percentage of their new crop in this program opposed to putting all of their future bushels in it. I was so grateful to learn from Lenice for two whole days to soak up as much as I could since I can see myself becoming a grain merchandiser one day. Thank you, Morgan McCarthy #2 My second two days at CGB in Scott City, MO I had the privilege to learn more about the operations side of the business. I had a discussion with Rick Loker who is the location manager for Scott City and Cape Girardeau. Rick has been with CGB for 44 years! He had worked for several different locations within the company including Cahokia, IL, which is not far from my hometown. When I arrived, Rick was finalizing paperwork from the safety audit the location had the day before. They normally have two safety audits a year to make sure that everyone is complying to set safety regulations. Rick later explained to me how Scott City normally loads 120 barges in a year, and they can do about three per day during fall harvest. However, 2019-2020 did not meet that average because their loading tower required major maintenance and was inoperable during the first few months of 2020 while it was being worked on. All the grain that CGB sends down the Mississippi eventually ends up in Convent, LA, which is where their headquarters reside. From there the grain is loaded onto a vessel and sent to Japan. Scott City also has about 350,000 bushels of storage space to store grain before it gets loaded onto a barge. Rick has a ton of responsibilities including the safety of his employees, loading barges efficiently, determining when he needs to load a barge to free up storage space, and much more. The day after I shadowed Rick, I shadowed Tripp Elliot. He is a group location manager who oversees three locations: Scott City, Cape Girardeau, and Bird’s Point, MO. The location managers for those three locations, including Rick, look to Tripp when issues arise and if they have questions that need to be answered. So, Tripp has a huge number of responsibilities as well. A few of them include creating daily position reports that show how much grain they have on hand and ordering parts that need replacing in the elevator. Later in the day I noticed that Tripp asked the three grain buyers at Scott City if they would be able to have their growers deliver soybeans to the elevator because he needed to fill a barge that was scheduled to come. Tripp later explained to me that he has to deal with grain quality issues when they come up. He said that poor grain quality can become a major issue if it is not addressed properly. A couple of the main quality issues he sometimes has to deal with are moisture and heat damage. He recently had to deal with a strange odor that was coming from the soybeans they had on hand. He believed the COFO was coming from treating the stored soybeans for insects. I am extremely grateful for the experiences that the GFAI has given me, including the monetary award, the immersion tour, and my job shadowing days. Thank you! Morgan McCarthy My name is Kyler Masching and I am from Cabery, Illinois. I have grown up surrounded by agriculture and when deciding what to pursue a degree in, I knew I wanted agriculture at the core of my studies. Currently, I am a sophomore at the University of Illinois studying Agribusiness: Markets and Management with a minor in Crop and Soil Management. I was blessed to of been chosen as one of the recipients into the Grain and Feed Association of Illinois Scholarship Program. Ever since being selected as a recipient into the Grain and Feed Scholarship Program, I was looking forward to attending the Grain and Feed Industry Immersion Tour. I enjoyed all of the tours we were able to go on and I feel I learned something new at each destination we toured. A few of the tours that really stuck out to me were the Peoria Lock and Dam, Marquis Energy, and Zimmerman Feed and Grain. The tour we were able to have of the Peoria Lock and Dam was very interesting as we saw what a drained lock and dam looks like. The lead engineer explained how vital these locks and dams are to the Midwest economy, especially to the agriculture industry and the repairs being made over the summer had taken years to plan in order to be completed as efficiently as possible. The tour of Marquis Energy was very interesting because Marquis Energy is one of the biggest ethanol plants in the world. It was remarkable to listen to the number of bushels of corn used every day at the plant in order to produce ethanol. Finally, our last stop on the tour was of Zimmerman Feed and Grain. We were able to observe all that goes into making hog feed and how careful the feed mill has to be when making feed.
Apart from the Industry Immersion Tour, I really enjoyed being paired with Consolidated Grain and Barge in Dwight, IL. This was a great 2-day job shadow as on the first day I was able to observe the grain merchandizers in the office and they explained to me where their purchasing area is and how they determine what basis to set for their grain based upon the grain’s end destination. I was able to sit in on a container marketing call and was explained why there is a container shortage in the agriculture industry in the United States and the complications that are included with that. While in the office, I learned about the different pricing programs CGB offers and then explained how these programs operate. On the second day of my job shadow, I was able to get a tour of the operations side of the grain elevator. This was very fascinating as I toured the flat storage building on site that holds 2.2 million bushels of grain. I want to thank Larry, Kevin, Sam, Hailey, and Mark for taking the time to give me a great 2-day job shadow. I am excited about my next blog post to share more about my job shadow experience! -Kyler Masching For my manager interview I decided to interview Gene Miller, an elevator manager in Fairbury, IL for Prairie Central Co-op. Gene began his career in the grain and feed industry with Honegger’s feed mill in Fairbury back in the early 1980s. His main responsibilities were loading feed trucks and taking care of feed inventory bags. Taking inventory was crucial to managing the supply chain of products for customers, and maintaining the necessary quantity of supplies to meet consumer demands based off of sales trends. After several months, Gene was introduced to an open position in 1989 with Prairie Central in Acoya, IL. Gene maintained the dryers for storage of grain and once again unloaded grain via train and truck. He eventually worked his way up to manager of the site in a few months. At the Fairbury elevator Gene also oversees grain quality, and blending and shipping to meet standards of processers. Much of his corn is sent to the Pontiac location, which is usually transported to chicken feed processors down south. The soybeans are sent to Incobrasa in Gilman IL. Another responsibility he has is taking monthly inventory of grain. The amount of grain on hand directly impacts the commodity prices of both corn and soybeans, so keeping an accurate record of grain stocks is important. Safety and housekeeping records are responsibilities that have become more prominent since Gene first started working in the grain industry. Safety regulations have increased or become stricter over time; thus, Gene has had to adjust to these rules to not only keep himself safe but also other employees. For example, a harness is required when entering the bin. Also, no one can be in the bin when the sweep auger is running. These are just a couple examples, but Gene mentioned that safety is one of the most important aspects of his jobs to ensure no one is harmed on the job and the grain is stored safely. Another major responsibility Gene manages is supervising seasonal help during the harvest season. Although, additional help is greatly needed during the busiest time of the year, managing part time help can be one of Gene’s most difficult challenges. Part time help isn’t always the most dependable, and having the ability to teach newcomers not only how to do the job but to also be aware of the safety standards is challenging to say the least. The major changes over the course of Gene’s career have mostly happened with farmers. Bigger equipment and less farmers have resulted in faster harvests. Technology has made processes more automated with less manual labor necessary. With that said, Gene still prefers to do things the old-fashion way. For example, many elevators no longer write the grain prices for farmers to see on a white board but Gene continues to do so for those few farmers that prefer this method over receiving text updates.
In regards to advice for someone interested in this industry, Gene suggested suitable characteristics that one would possess would be a strong work ethic and would enjoy working outside although in dusty and uncomfortable conditions at times. Working well with others and knowledge of equipment are a positive attribute to have as well. To successfully prepare for a career in this field Gene stated there aren’t really in required steps necessary. Ultimately, as demonstrated by Gene himself, owning an inherent ability to work hard and being motivated to learn will lead to a prosperous and satisfying career. As for obtaining a four-year degree, Gene suggested earning one isn’t imperative to have a solid career in the grain industry. Although one may be beneficial, through internships and the never-ending desire to attain more knowledge, one can easily work their way up the ladder in the grain industry. The last topic we discussed was Gene’s favorite and least favorite part of the job. As much as Gene likes working outside, fighting with defective equipment in unfavorable weather is never ideal. On the other hand, having the regular opportunity to converse with farmers and working independently are nice benefits of the job. Overall, Gene provided me with great insight to what his job consists of and some valuable information that will benefit me as pursue my career after graduation. This last month I had the privilege of conducting an interview with Justin Burke to learn more about the grain and feed industry. Justin is a Grain Merchandiser for FS Grain in Morris. There his duties include the selling of grain to the different markets available to him at his northern Illinois location. Some of these markets include container, river, ethanol, or rail. Justin also oversees FS Grain’s hedging platform to manage the risk of the company.
After learning about his position, I asked about his history within the agriculture industry. Justin grew up a few miles away from me in northern Illinois on a family grain operation. While attending Western Illinois University he got his first experience working for the GROWMARK system while interning as a crop scout for Ag View FS. Upon graduation, he started his career at Ag Land FS. After a few years there he started working for Maplehurst Farms before taking on his current position. In these two positions, he worked in more of an elevator operations role as well as buying grain from farmers. Although he enjoyed his time learning in these roles he loves working as a grain merchandiser. When asked why, he responded by saying it is due to the constant change of the markets. With factors in the market always changing so does the prices. You never know what your day is going to be like. During our interview, I also asked him how he was trained and how he continues to learn. When coming to FS Grain Justin used a lot of his prior experience to be successful. Soon after starting he was beginning his role. He learned by doing and what he didn’t know he asked others for their advice. This mentality has made him a successful grain merchandiser for the 23 different FS Grain locations he sells for. In the future, he plans to continue to learn more about the different markets available to sell to. When asked about why he choose FS Grain he said it was the culture of the company. He loved being part of a large company with many entities but wanted the small company connection. Being a part of FS Grain provides him this. Because GROWMARK is a cooperative he feels it has a greater connection with the farmers they work with. I enjoyed getting to know Justin and his experience at FS Grain better. It was interesting to learn about the position from his perspective. |
Grain & Feed Association of Illinois3521 Hollis Dr. Archives
April 2024
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