• Routinely monitor and develop a list of pathogens in a pig population, which is vital to the success of an antibiotic-free system.
• Identify the challenges affecting productivity and profitability on-farm, as well as aspects of housing, husbandry and management that may be causing issues.
• Re-evaluate biosecurity both internally and externally. Examine herd flow, cleanliness, transportation and employee traffic.
• Establish and implement an effective vaccination program with the veterinarian that supports herd health and safety.
• Build a nutritional platform in the pigs’ diet that includes technologies to reduce the risk of pathogens and improve immunity.
• Be ready to adapt. Reducing antibiotics or implementing an antibiotic-free program takes time. Observing how these changes impact the animals’ health and production is an important part of this process. Make sure there is room in the plan to make improvements.

The following is a preview of Aidan Connolly's post, which you can find on LinkedIn. 

Question 1: Why are antibiotics in animal feed in the first place?

Antibiotics have been good for the world. They have been instrumental in allowing humanity to enjoy a standard and quality of life unimagined prior to their discovery. Initially, antibiotics allowed us to control life-altering and fatal diseases in humans.

Secondarily, they have facilitated the development of a modern, safe and efficient agricultural system that produces food economically, affordably and plentifully for most of the 7 billion people on the planet. 

When farmers began putting antibiotics in the feed of animals in the 1950s they did so initially because it resulted in lower mortalities but quickly they also noted their animals grew faster, requiring less feed. Veterinarians later observed better intestinal health and less inflammation during autopsies and surmised that the improved animal performance was most likely due to the more efficient absorption of nutrients in the intestine of those animals.

Question 2: Where does resistance come from?

The simple definition of resistance is “the ability of microbes to resist the effect of antibiotic drugs” and the mechanisms by which bacteria become resistant and pass on that resistance to other bacteria are relatively well known. Bacteria adapt very quickly to the environment, so when antibiotics are used continuously, the bacteria they are meant to kill can adapt, survive and replicate making it extremely difficult to kill the remaining bacteria. Resistance can develop through selective pressure (that is, when antibiotics kill some but not all of a bacterial group), mutation and gene transfer. These three mechanisms can also combine, as when bacteria not only become resistant to antibiotics, but also start to pass that characteristic on to other bacteria present in the gut. 

There are many sources of resistance with examples in humans and animals, including the inappropriate use of drugs or inadequate diagnostics in hospitals or veterinarian situations, the use of antimicrobial soap in bathrooms, the use of zinc oxide or copper sulfate in the diets of animals, and the use of chlorine in water of humans and animals alike. Scientists have demonstrated that these and any substances that create pressure on a microbial population lead to changes similar to the passage of resistance. 

Overall, humans are the main source of resistance, due to the misuse of antibiotics, not using them for the time period recommended by their doctors, or not using the recommended dose. Hospitals and homes for the elderly have become hot spots of resistance, which puts older people, very young people and immune-comprised people who are the least capable of fighting off infection without antibiotics at the highest risk.

It is clear that antibiotic use in humans is not uniform. For example, looking at a map of the U.S., antibiotic misuse per 1000 people tends to be concentrated in the eastern part of the country rather than the west, with over-prescription particularly prevalent in the South and Midwest. Recent studies indicate that an average of 506 antibiotic prescriptions are administered per 1000 doctor visits, while experts concluded that only slightly more than half of these prescriptions were actually necessary or appropriate.

In animals, resistance works the same way, and the passage of resistance from animals to humans can occur through contact with live animals or environmental contamination. (In 2005, the CDDEP found that when antibiotics are fed to animals 90% go through urine and 75% were found in feces; more recently antibiotic resistant bacteria have been found in water systems, waste treatment and in dust carried by air.) It also seems to be possible for resistance to be passed through the consumption of meat, milk and eggs from contaminated animals (for example, a U.S. study found that 53% of grocery chicken contained antibiotic resistant E. coli). 

Farmers are often irritated that activists focus on antibiotics in animal food, when the majority of resistance come from human misuse/overuse/abuse, but the general public finds it easy to agree with Prince Charles (speaking to the Royal Society in London) when he said, “I find it difficult to understand how we can continue to allow most of the antibiotics used in farming, many of which are also used in human medicine, to be administered to healthy animals.”

Read the rest of Aidan Connolly's post, including the next five questions and answers, here. 

Amino acids — the basic building blocks of every organism — are important for plant growth, development and metabolism. Plants must synthesize amino acids in order to grow, develop and perform all routine metabolic functions.

While animals must obtain amino acids through their diets, plants can synthesize their own. However, in order to conduct this process in the most efficient manner, plants must have an adequate and continuous supply of beneficial nutrients. Water and sunlight availability are also key in order for plants to perform these functions.

Building from a strong technology base

As a leader in chelation technology for animals, Alltech is now applying the same technology principles to plants for the benefit of crop producers. Alltech Crop Science has focused on the principles of complexing to support and improve plant nutrient uptake.

How? The inherent complexing nature of amino acids is used to deliver a balanced source of essential nutrients in a uniquely bioavailable form.

Improving efficiency through precision application

“With foliar-applied micronutrients, complexed minerals are easily and quickly absorbed and their uptake is optimized,” said Nicolas Body, agronomist and European technical manager for Alltech Crop Science.

This can aid in production efficiency.

“There is basically zero waste,” added Body. “Rapid absorption by leaves, combined with targeted application, can provide plants with immediate access to essential nutrients.”

Plant-based solutions for a sustainable future

Alltech has the ability to “grow” these natural microorganisms at company facilities for amino acid extraction. In fact, 18 of 20 amino acids can be extracted from yeast, which is Alltech’s core competency. With one of the largest yeast facilities in the world, Alltech has a bountiful supply of raw materials utilized for the production and extraction of these naturally occurring amino acids.

“We are finding in nature the tools to help producers with nutrient management as well as crop protection and performance,” said Body. “Today, it is now possible to use natural organic acids to do the job of synthetic chemicals.”

This technology will help growers and consumers promote environmental sustainability without compromising quality and yield. Maintaining plant health through proper nutrition can reduce the need for synthetic inputs that can cause consumer concerns and pose environmental risks.

The following essential plant micronutrients have successfully been complexed with amino acid technology and can promote efficiency with each of the following functions:

Copper: Essential for chlorophyll formation and reactions involved in photosynthesis. Sandy, high-pH soils are most prone to copper deficiency.

Manganese: Aids in germination, maturity and availability of other nutrients. Waterlogged, high-pH organic soils are most prone to manganese deficiency. Herbicide stress is also a common contributing factor to manganese deficiency.

Zinc: Essential for growth, zinc plays a role in building growth hormones and in photosynthesis. Zinc deficiency is common with cool, wet weather and appears as stunted growth and shortening of internodes.

Have a question or comment?

2016 has been a remarkable year thus far. This past month we welcomed more than 3,000 friends from 71 countries for an unbelievable week of idea-sharing and inspiration at ONE: The Alltech Ideas Conference. We also grew the Alltech family through the acquisition of Keenan, a leading farming solutions manufacturer known particularly for their “Green Machine” and InTouch Technology.

Today it’s a delight to share further excitement as we welcome Coppens International, an innovative Dutch aquatic feed and nutrition company, to our family. READ the press release here. 

Coppens International is known around the world as a technical specialist that produces high-quality aquatic feeds. The Coppens International team works continuously to perfect their formulas and develop new feed to cater to market demands. They have drive, they are passionate and they care – all qualities we value here at Alltech. Coppens International’s innovative techniques provide us with a winning combination for delivering greater efficiency and profitability direct to our aquatic producers.

Together we will now offer a breakthrough development in the feed industry by providing a fish feed completely derived from a sustainable and traceable fish oil replacement.  With Coppens International, we complete the cycle from a sustainable source of microalgae, rich in DHA omega-3 fatty acid, through to fish feeds and into fish products. The production of our algae is based on yeast components from which the algae gain a number of critical nutrients to grow, produce the high fat content and, even more importantly, high levels of the DHA omega-3 fatty acid. This active ingredient, as in many of our other yeast-based products, ultimately improves animal and fish health, while providing DHA-rich, functional foods that deliver a wide range of well-known health benefits to consumers. Now there is a true marriage between a unique aquatic feed manufacturer and an animal health-focused algae production facility! In fact, our plant in Winchester, Kentucky is food-grade and approaching more than 20,000 tons annually, with capacity expected to triple by year-end.

Using Alltech’s primacy in science combined with Coppens International team of researchers, we believe we will be one of the first to completely remove fish meal and fish oil from feed. We will replace these with Alltech’s FOR PLUS, which is derived from algae, and produced in our dedicated algae facility in Kentucky. We will be able to guarantee our customers a source of DHA which is traceable, sustainable and without the contamination issues of fish products. 

Just like Alltech, Coppens International is passionate about customer-centered research. In fact, they have 17 hectares of ponds devoted to research and raising specialty fish such as aquarium fish.  With two dedicated extruders, the company’s products are shipped around the world, and their capacity will increase shortly with a third extruder in the coming months. In looking to the future, Dr. Karl Dawson, chief scientific officer at Alltech, said, “We will continue sharing results of the successful use of Alltech’s FOR PLUS in all animal and fish diets. We have already demonstrated some surprising benefits for production animals. At Alltech, we remain steadfastly focused on our ACE principle of being friendly to the Animal, the Consumer, and the Environment.”

By joining Alltech, Coppens International is achieving one of its long-held ambitions - the replacement of fish oil with Alltech algae technology. Given the unsustainable global supply of fish oil, this is a true leap forward for their aquaculture nutrition program.

In fact, did you know that we own one of the only fully-operational, large-scale algae production facilities in the world? At the Alltech Algae facility in Winchester, Kentucky, we have invested heavily to develop proprietary algal technology for application in aquaculture, pet and livestock nutrition. No longer a buzzword, algae are gaining attention for their application to the feed and food industries as a highly sustainable source of DHA omega-3, and Coppens International will now be leveraging our algal technology.

We see plenty of synergies that can occur with Coppens International. Fish farms will have improved direct access to the most cutting-edge, sustainable technologies relevant to today's aquaculture industry demands.

In April this year, we launched the Alltech Aquaculture Postgraduate Program, a joint research partnership with the world-renowned University of Stirling Institute of Aquaculture in Scotland, and we are also making great progress with Alltech Aquaculture in Kentucky. Again, why? We see the opportunities ahead within the exciting sector of aquaculture.

The aquaculture sector is experiencing tremendous growth worldwide. In fact, did you know that aquaculture is the fastest growing segment of the animal feed industry? According to the Food and Agriculture Organization, fish consumption now exceeds beef consumption per capita, and farmed fish now exceed wild caught. What an opportunity!

Together, Alltech and Coppens International will ensure that aquatic producers around the world can practice responsible and efficient aquaculture. Together, we will make a sustainable contribution to food production for a growing global population that demands the very best. It’s the opportunity of a lifetime to work hand-in-hand on delivering aquaculture solutions.

Welcome to our family, Coppens International!

[DUNBOYNE, Ireland] – Alltech has acquired Coppens International, a leading international aquatic feed solutions company in the Netherlands. Coppens International is now part of the Alltech family of companies, which includes 14 other companies that Alltech has acquired globally since 2011.

For almost 24 years, Coppens International has earned a strong reputation for being an innovative, high-quality aquatic feed producer. The company’s specialties include temperate and tropical marine and freshwater diets for a variety of juvenile and adult species. The company also produces top-quality ornamental, specialty and bait feeds. Alltech’s latest acquisition enhances the Coppens International product range by integrating Alltech’s microalgae and protein platforms, thereby providing customers with cutting-edge sustainable technologies pertinent to success in today’s demanding aquaculture industry. 

Always thinking ahead, Alltech already owns one of the world’s largest commercial algae production sites in Kentucky, USA. No longer a buzzword, algae are gaining attention for their application to the feed and food industries as a highly sustainable source of protein and DHA omega-3.

Coppens International is one of the most innovative, high-quality aquatic nutrition businesses that manufacture a range of aquatic nutrition solutions, with a strong production infrastructure, right in the heart of Europe. Coppens International has an impressive and dynamic distribution network spread across more than 60 countries, including the Netherlands, France, Germany and Australia. Coppens International products are sold to fish producers via direct sales or through distributor and dealer channels.

“Coppens International has many qualities we admire in a fish nutrition business: a robust, quality production system, dynamic routes to market and a pioneering spirit for research and development, which, all combined, present us with numerous synergies,” said Dr. Pearse Lyons, founder and president of Alltech. “With a combination of Alltech’s primacy in science and Coppens International’s strong distribution network, we have a winning formula for moving aquatic nutrition forward to greater feed efficiency.

“Aqua producers face many common challenges, such as mineral absorption, feed costs and efficiency,” continued Dr. Lyons. “With Coppens International now part of the Alltech family, we can make global efforts to address these challenges for our customers.”

Improved nutrition is a pressing need for the productivity of the world’s aquatic food chain. By improving nutrition, aquatic producers are able to realise a significant increase in feed efficiency.  Alltech’s continued commitment to tailoring nutrition and health programmes allows producers on the land and in water to raise healthier animals, crops and fish through a process that is better for animals, fish, consumers and the environment. With the welcome addition of Coppens International to the Alltech family of companies, fish producers around the world can expect nutritional, efficient and effective aquatic feed.

“With an average growth rate of 10 percent per annum, this is a truly exciting time to be in the aquaculture sector,” said Anno Galema, managing director of Coppens International. “By joining Coppens International with Alltech, we now capitalise on this growth and bring together the best aquatic nutrition solutions to aquatic producers around the world.

“I am delighted Coppens International is now firmly connected to a company at the forefront of science, animal health and nutrition,” continued Galema. “Our future with Alltech now strengthens our ability to deliver aquatic feed nutrition solutions like never before.”

Coppens International will continue to be headquartered in Helmond, the Netherlands, and led by Galema, who will report to Patrick Charlton, vice president at Alltech and newly appointed CEO of Coppens International.

The Coppens International business is spread across three locations. The first, its headquarters in Helmond, the Netherlands, focuses on customer and sales support. The second location in Nettetal, Germany, focuses on production, scheduling and logistics, exporting quality aquatic feed to more than 60 countries worldwide. The third location in Valkenswaard, the Netherlands, focuses on research and development.

Alltech has more than tripled its sales in the last four years, with current sales revenues in excess of $2 billion USD. Since 2011, Alltech has successfully completed 15 acquisitions.

“Today’s aquaculture sector requires focus, dedication and an aggressive approach to continuous improvement of nutritional technology,” said Charlton. “Moving forward together with Coppens International provides a wealth of opportunity and growth, which will benefit aquatic producers across the globe.”

Read Dr. Pearse Lyons' thoughts on the acquisition and how this will impact global aquaculture nutrition on our blog. 

What do you say about an iconic individual that you are fortunate enough to have spent moments with in life?  What do you say about someone who, when we brought him to Ireland, packed the hall? He was a man who said the least but also the most. 
 
When we brought Muhammad Ali to Ennis, Co. Clare, Ireland, to Turnpike Road, where his great-grandfather, Abe Grady, came from, to say the streets were packed would be an understatement.  With ties from all over the world right there in the middle of Ennis, we laid a stone commemorating the return of a long lost brother to Ireland. 
 
I will never forget seeing him when I was a 26-year-old, fight Blue Lewis from Detroit, right there in my home of Dublin at Croke Park.  The pounding these men gave each other was remarkable, and you would have to be there to hear it to understand.  When I said to him many years later, as I saluted him at our annual Symposium event in 2009,  "You know when you were in your prime, and I was in my prime, I always reckoned that I could take you in three."  He looked at me, looked at the audience, and signaled on his head with his finger that I was loopy. 
 
At the 2010 Alltech FEI World Equestrian Games, Ali was most at home when he was greeting the children from Haiti.  They sat on his knee, and he tickled their tummies, and they knew they were safe with him. 
 
I sat with him in the car waiting to go into the Kentucky Horse Park outdoor arena for the Opening Ceremonies of the Alltech FEI World Equestrian Games, and Coach Calipari had gone in the stadium just before us. I said to Ali, "Let's hold back.  This is your time."  As soon as he heard the crowds, it was like an electric switch went off in his brain.  He waved to the left and to the right to all his adoring fans.  That is the Muhammad Ali I will always remember. 
 
I have a collage of pictures in my office of our memories together, and not a day goes by that I don't see it. To have had the opportunity to meet him when we brought him across to Ireland to visit his great-grandfather’s home, and to watch his face as we relived his fights on the plane’s movie screens on the trip over is something that I will never forget.  We lost an icon.  We lost a great man. 

With only 12 percent of land on Earth suitable for crop farming, both water efficiency  and soil health are of equal importance. The world’s precious soil hosts more than a quarter of the planet’s biodiversity.

“However, as soils are continually treated with pesticides and fungicides, hundreds of ecosystems and billions of microbes are being destroyed,” said Robert Walker, global general manager for Alltech Crop Science, at ONE: The Alltech Ideas Conference.

This leads to imbalances that destroy crops, sometimes not just for a season, but for the foreseeable future.

According to the United Nations Food and Agriculture Organization (FAO), 20 to 25 percent of soils worldwide have already been degraded through modern agriculture practices. In fact, an additional area the size of Austria is degraded each year.¹ The world’s growing population, with an increasing demand for food production, has brought new attention to soil degradation.

“Unless new approaches are adopted, the global amount of arable and productive land per person in 2050 will be only a quarter of the level that was available in 1960,” said Walker, citing the FAO report.

Time is of the essence in finding new solutions, as it takes 1,000 years for 3 centimeters of new topsoil to be generated.  Where can answers be found for application today? Walker sees opportunities in organic farming, precision agriculture and beneath our feet, in the soil itself. 

Answers rooted in the soil: Microbes at work

“Proper soil nutrition should be our first line of defense,” said Walker on the topic of saving the soil and helping producers increase their crop production.

“Only 2 percent of all microbes in soil have been identified. What if we were to harness the other unidentified 98 percent?”

Microbes can help support plant health in the following ways:

• Increasing nutrient availability
• Enhancing root growth
• Neutralizing toxic compounds in soils
• Providing disease suppression
• Increasing plant immunity and boosting resistance against environmental extremes

One success story can be found in Costa Rica, where microbial technology is being successfully deployed to help banana producers fight disease and reduce the use of synthetic fungicides.

By incorporating new microbial technologies with soil management methods such as conservation tillage, producers have ONE big opportunity, Walker predicts. While synthetic chemistries have helped with feeding a growing population, weed resistance and limited productivity challenge current systems.

“It’s time to develop a new system of agriculture based on natural principles for crop and soil health and productivity,” said Walker.

An additional benefit of integrating microbial technology with conservation tillage applies to water use.

“With each 1 percent increase in organic matter, there is the ability for the soil to hold an additional 20,000 gallons of water per acre,” concluded Walker.

He encourages producers worldwide to adopt ONE new technology to conserve soil vitality.

To read more about soil, which is “our silent ally in food production” according to the United Nations, and Alltech’s microbial research, click here.

Source 1: Institute for Advanced Sustainability Studies, “Soil Atlas 2015.”

Robbie Walker was a presenter at ONE: The Alltech Ideas Conference. Audio recordings of most talks from ONE will be made available on the Alltech Idea Lab by mid-June 2016. For access, click on the button below.

Income over feed cost (IOFC) can be a critical metric when evaluating a farm’s profitability and the sustainability of a current or proposed feeding program. During times of low milk prices, understanding your costs can be crucial to a farm, effectively riding the wave to the next high or low in the milk price storm.

Understanding IOFC

IOFC is defined as the portion of income from milk sold that remains after paying for purchased and farm-raised feed used to produce the milk.  

Information you need to calculate IOFC:

1. Milk price average per month
2. Total milk produced per day over the period of a month
3. Number of cows as it relates to production during that month
4. Inputs (amount of feed used)
5. Cost per ton of feed input (to purchase or produce)

To illustrate with an example, we will use a 142-cow milking Holstein herd in Kentucky.

• Income
  • Milk price:  $15.50
  • Number of cows: 142
  • Average pounds produced per cow per day: 78 pounds
    • Income per cow per day: $15.50 * .78 = $12.09
• Feed costs:

IOFC = $12.09 (income) - $5.53 (feed costs) = $6.56 per cow per day

Feed to succeed

When evaluating your ration to maximize IOFC, there are potential changes that carry minimal to no cost but can have an impact on your bottom line.

1. Slow release non-protein nitrogen provides a concentrated source of ruminally-degradable protein. Due to the concentrated nature of the protein, a small amount provides the same nutrients as a larger amount of vegetable protein, allowing for reformulation potential to reduce feed costs. Optigen®, a product from Alltech, was utilized by Penn State in an example of IOFC calculation. You can read more here: http://www.dairyherd.com/news/industry/production-financials-cash-flow-mechanics.
2. Yeast: Feeding yeast has been widely researched and has shown to improve dry matter intake, stabilize rumen pH, maximize nutrient release and reduce overall feed costs.
3. Enzymes: Looking at the use of enzyme technology can be another avenue to maximize IOFC.  When feeding high-forage or high-corn diets, adding an enzyme that helps break down the key components in these diets, such as starch or plant fiber, can increase feed efficiency and improve milk production.

Using tools such as IOFC can lead to opportunities to gain a better understanding of your ration, to improve profitability of your herd and to understand your spending power when it comes to other on-farm purchases.  

Meet Neil Keane, manager of the 2016 European Dairy Career Development Program (DCDP). After successfully running the Beef Career Development Program in Europe in 2015, Neil will be in charge of recruiting, training and helping a new generation of graduates grow a successful career in Alltech. Neil is anxious to meet the new DCDP members and shared his impressions and expectations of the program.

Please tell us a little bit about your role in Alltech.

Originally from Ireland, I have a master’s of science in ruminant nutrition from the University College Dublin and a postgraduate diploma in business management from the University of Plymouth. Working in Alltech for more than 11 years now, I am responsible for our ruminant sales in Europe; developing and setting up trials for our new biogas project with Niall Brennan, a former DCDP member; and providing our European dairy customers with sustainable and profitable solutions.

As the Dairy Career Development Program manager, what are the most important skills you are looking for during the hiring process?

When screening candidates for the Dairy Career Development Program, a degree in animal science, dairy science or veterinary science is essential as the position requires a good technical knowledge of animal health and nutrition as well as the dairy industry. The key skills we look for are openness, curiosity, humility, flexibility and enthusiasm. As the program seeks to develop a sales role, it is important that candidates display good interpersonal skills. Being sociable and outgoing is essential, and it allows our graduates to build good relationships with customers. Alltech is a fast-paced environment, having the ability to adapt and work on various projects is vital.  

The Dairy Career Development Program is a year-long learning process, what do you expect from the members upon completion of the program?

Upon completion of the Dairy Career Development Program, Alltech hopes that all members will have grown in confidence in their daily activities. Our world-class training provides graduates with not only innovative solutions for modern dairy farming but it also provides them with an opportunity to develop new solutions based on their first-hand knowledge on the farm. Professionally, we expect them after this year to be able to bring value to the dairy producers they work with, to develop their own projects bringing innovation to their market and to have them take full ownership of these ideas.

How would you describe your relationship as a manager with members of the program?

Throughout the year, we ensure a supportive environment for DCDPers. Previous programs have taught us that we need to maintain frequent communication to assist the members if needed. We also try to set the best conditions and give members access to resources to facilitate them pursuing opportunities and developing their own projects. DCDP members receive support and mentorship from senior members of Alltech as well as industry leaders to help them succeed in their careers.

In your opinion, what is special about the Dairy Career Development Program?

In addition to the uniqueness of the program and opportunities to travel, the DCDP gives graduates a chance to work with senior leadership. The approach Alltech will be taking is not just to instruct and share knowledge, but to show the graduates the route of experiential learning. The hands-on programme allows graduates with a passion for dairy farming to develop solutions for emerging industry issues and make their stamp on the industry. We aim to develop the next generation of dairy nutritionists who are ready to support and develop the global industry. Ongoing challenges, such as weak import demands, excess supplies and the ever-changing climate, continue to shake the dairy industry. This investment by Alltech shows the significant importance of the global dairy industry to us and our belief in the importance of supporting future dairy industry leaders.

What advice would you give to applicants to the Dairy Career Development Program?

Alltech is seeking graduates who have a passion for dairy. It is essential to know and understand Alltech and its values. I would advise graduates to read our ACE principles. Throughout the selection process, we want candidates displaying honesty about their skills and personality and sharing about themselves openly.

Have a question or comment?

In today’s world, competition in the marketplace is significantly greater than it was 50 years ago. Damien McLoughlin, Anthony C. Cunningham Professor of Marketing at the University College Dublin Michael Smurfit Graduate Business School, opened up the final plenary session of ONE: The Alltech Ideas Conference by discussing a strategy for differentiation.

“What is it that you can do to make your competition irrelevant?” asked McLoughlin. “What is it that you can do to make competition less significant in your competitive and business life?”

The theme of McLoughlin’s talk pivoted off these questions. He gave many reasons why he believes competition is more intense right now, but the most important factor is the advance in technology.

“Today, all of the power is with the buyer,” said McLoughlin.

He said places like China, the Philippines, Vietnam and other competitors of the U.S “have access to ideas from the old world and they are applying those at new markets in the new world.”

“They’re pushing competitive activity in a way that we haven’t experienced before,” he explained. “These first three forces (Technology, globalization, demographic change), of course, are all beyond the control of any person in this room… However, there is one other force, which is impacting our ability to affect competition; that’s the strategic or strategy choice.”

McLoughlin then explored the “red ocean” and “blue ocean” strategies that define businesses.
 

Red ocean strategy
 

A prime example of a “red ocean” business is the soda industry. McLoughlin said that when you see soda in a grocery store, everything is priced the same and looks exactly alike.

“When their competitor takes action, they copy it straight away,” he said, illustrating one of the signs of a red ocean.

He believes this strategy consists of companies that compete in existing market spaces, beat the competition, exploit existing demand, make the value-cost trade-off and align the firm’s activities with its strategic choice of differentiation or low cost.

According to one of McLoughlin’s slides, the “red ocean” is the death of a firm.
 

Blue ocean strategy
 

McLoughlin used Southwest Airlines as an example of a “blue ocean” business. 

“They smashed the rules of competitive engagement, created large uncontested new markets, simultaneously pursued value and low cost,” he said.

The outcome of this strategy was that Southwest Airline is now the number one airline in the U.S, with an 18.5 percent market share in 2016.

A blue ocean strategy is the exact opposite of the red ocean strategy. You will know you have a blue ocean company if you, “create uncontested market spaces, make the competition irrelevant, create and capture new demand, break the idea of value-cost trade-off, align the whole system of a firm’s activity in pursuit of differentiation and low cost,” said McLoughlin.

“It’s a tall task,” he said.

McLoughlin says that the main core principle of blue ocean strategy is value innovation. “What I mean by that is, we find ways to reduce our cost,” he said.

The craft beer industry, Ocado (an online supermarket in the United Kingdom) and Justin Trudeau, prime minister of Canada, are also successful utilizers of blue ocean strategies.

McLoughlin asked the audience two questions:
 

1.Do you dare to be different?

2.Are you willing to invest the strategic thinking time needed to create blue oceans?

He said four tools are needed for a blue ocean strategy within a company:

1. The strategy canvas.
2. The four actions framework.
3. Find new customers by looking for non-customers.
4. Price corridor of the masses - Price to encourage as many people as possible to buy the product.

Mission-driven companies are often viewed as places where employees feel their work contributes to a higher purpose. When it comes to “mission-driven agriculture,” the industry is now responding to consumers who are looking for their food/diet to serve a higher purpose, said Rebecca Noble, Alltech Crop Science business development executive.

“Consumers’ perceptions of their diet have changed,” added Noble. “Food and nutrition are now seen as a gateway to health. It’s not just about weight loss and body image.”

A 2015 Nielsen report asserts that, globally, 80 percent of consumers are choosing foods for their diet as a means to forestall health issues and medical conditions. Consumers are also increasingly factoring agricultural production methods into their food purchasing decisions.

“Their decisions are now based on beliefs and convictions that go far beyond cost and convenience,” said Noble. “Awareness about the social and environmental impacts of farming is also fueling their decisions.”

Agriculture is being called upon to reinvent itself and further propel human advancement.

“The industry is now being transformed into a mission-driven industry,” she said.

Who is in the driver seat?

Perhaps in no other industry are the needs and desires of consumers being felt so profoundly than in food production, commented Noble.

“Mission-driven consumers are flooding the marketplace with greater capacity and purchasing power each year,” she said.  

Believing that the right food choices will lead to better health, 25 percent of consumers are willing to pay a premium for products, with the following five categories being key:

• All natural
• GMO-free
• Low/no fat
• Gluten-free
• Organic

The organic category continues to be the largest segment for attracting premiums in store aisles. In 2014, organic sales in the U.S. reached $40 billion, and global sales are projected to reach $1 trillion by next year.

Grocery stores are reporting that new food perceptions are especially concentrated in younger generations, with millennials driving the organic category. Adding to the momentum is Generation Z, aged 20 and under, as many of them head to college and make independent food purchases for the first time.

With growing demand, retailers are working creatively to keep their organic supplies steady. One big box store is even lending money to farmers to help them secure land for organic production.

What’s ahead on the journey?

Sales of foods grown locally could eclipse sales of organic food. Grocery chains and big box retailers are aggressively expanding and marketing their locally grown offerings for sale. Retailers are finding themselves reinventing their stores to provide high quality, locally produced food that is also affordable.

Demands on conventional farming are the next frontier, as consumers continue to want to know more about the way in which their food is produced, explained Noble.

 “Mission-driven producers are working carefully to not just change their agricultural practices to respond to consumer demands,” she said. “They are helping to tell the story — creating new narratives — surrounding food production.”

Likewise, some large retailers are creating consumer-facing campaigns. They are educating shoppers beyond health and wellness issues to producers’ management and land practices, water use, farm worker safety and energy consumption.

Within a mission-driven agriculture system, Noble described symbiotic relationships forming between both retailers and consumers and retailers and producers.

“Consumers are no longer just simply eating,” said Noble. “Retailers are no longer simply just buying and selling. Producers are no longer being asked to just simply produce. Things have been put into overdrive.”

Metaphorically, we’re all in the car together, concluded Noble. This will call for true collaboration, especially between retailers and producers, to realistically and systematically take us to the next frontier.

 “Consumers and retailers are influencing each other, and more and more producers are taking their business, their mission and how they are perceived in the market into their own hands,” Noble concluded.

Finally, market competition will play a key role in keeping mission-driven dreams balanced, attainable and accessible for all.

Rebecca Noble was a presenter at ONE: The Alltech Ideas Conference. Audio recordings of most talks from ONE will be made available on the Alltech Idea Lab by mid-June 2016. For access, click on the button below.

Our species is experiencing a technological inflection point, according to David Hunt, co-founder of Cainthus.

“Science fiction is becoming science fact,” he said.

In just the last few years, we have landed the rover Curiosity on Mars, discovered the Higgs boson particle and discovered gravitational waves. Hunt, a self-proclaimed science fiction fan, seemed especially impressed by the harpooning of a comet in 2015.

Technological advances on the farm

Hunt has worked for years on some amazing, but slightly more down-to-earth than comet capture, technologies. He and his twin brother co-founded Cainthus, a company dedicated to digitizing agriculture. He described some of the company’s projects in breakout discussions on dairy and the future of farming at ONE: The Alltech Ideas Conference.  

Facial recognition for cows

The audience got a glimpse into a few fascinating technologies, some of which are here now and others that are right around the corner. Digital cameras are at the core of many of these advancements. Cainthus has developed facial recognition software for dairy farms that can memorize the face of a cow in six seconds and monitor the activity of an entire herd without wearable tracking devices. They are creating algorithms that will allow their software to alert a farmer when cows show early signs of lameness or when they fight over the best feed. When cows fight, it typically disrupts the entire herd and interrupts them from feeding for up to two hours, which certainly has an impact on milk production.

Scouting fields with drones

Drones are being adopted at a rapid rate on the farm, and Hunt talked about both the potential and the limitations of their use. Self-flying drones are already very successful for monitoring crop growth. Hunt looks forward to a day when farms are photographed twice a day. He warned farmers not to accept any offers from companies offering to fly drones over their farm manually. The cost is prohibitive and would not allow frequent enough flyovers to be beneficial. Current drones are disruptive for use in animal agriculture and will not be fully effective until they are small enough to go unnoticed by animals or can fly high enough that they won’t be seen.

The future of agricultural robotics

Robots will have an enormous impact on agriculture in the next several years. Hunt showed a video of two dog-like robots walking side by side. One was large and clumsy looking, the 2010 model. The other was sleek and graceful and was released just four years later.

“Imagine what they will look like by 2050,” said Hunt.

The significance of robotics for agriculture is huge. Robotic harvesters could allow farming to return to polyculture, the practice of growing multiple crops side by side in the same field. Planting and harvesting with combines has allowed farmers to feed an ever-growing population by ramping up production, but it is dependent on monoculture planting. Polyculture is closer to the natural ecosystem, and proponents say that it results in better soil health and easier pest management.

Digitizing agricultural decisions

Digitizing agriculture will allow farmers to make decisions based on data rather than emotion or hype. Hunt stressed the importance of this, emphasizing the need to base decisions on what is happening on your own farm and not anecdotal evidence from another farm, even the one next door.

“Just because a product works incredibly well on your neighbor’s field doesn’t mean that it will work well on your field,” said Hunt. “If we have precision management observing what things work, what works, what does not work, on a meter-by-meter basis and a plant-by-plant basis, there is no emotion, there is no hype. There’s just good decisions and maximization of productivity.”

In closing, Hunt offered a challenge.

“We have an opportunity today to use the tools that are here to create a utopia by 2050,” said Hunt. “We also have the tools available today to have this planet being a desert by 2050. The choices we make today are going to determine which one we leave behind for our children.”

David Hunt was a presenter at ONE: The Alltech Ideas Conference. Audio recordings of most talks from ONE will be made available on the Alltech Idea Lab by mid-June 2016. For access, click on the button below.