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Animal nutrition trends, challenges and opportunities
14 Plays3 years ago
Cody Swan, commercial director for Kemin's U.S. beef, dairy and equine business, and Marc Hoopingarner, commercial director for Kemin's U.S. swine and poultry business, discuss trends, challenges and opportunities in the animal nutrition industry.
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Transcript
Introduction to Animal Nutrition Trends
00:00:06
Speaker
Hello and welcome to the Feed Strategy Podcast.
00:00:08
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I'm your host, Feed Strategy Senior Reporter, Anne Roos.
00:00:12
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Cody Swan is the Commercial Director for Kemen's U.S. beef, dairy, and equine business, and Mark Hoopengarner is Commercial Director for Kemen's U.S. swine and poultry business.
00:00:21
Speaker
I recently spoke with both of them about trends, challenges, and opportunities in the animal nutrition industry, as well as gut health and how feed additives and other tools can promote good gut health in livestock and poultry.
00:00:32
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Here's our conversation.
What are the trends for 2023 in animal nutrition?
00:00:34
Speaker
Cody, what are some trends in animal nutrition that you expect to see throughout 2023?
00:00:37
Speaker
So this is Cody.
00:00:39
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And from a Kemin standpoint, this is, you know, this is a question that we review often.
00:00:44
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Um, and we've really trended this direction on the past few years, and I don't think it's really, really changed moving into 2023.
00:00:51
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And one of our largest focuses is a continued focus on gut health.
00:00:56
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And that seems to be a buzz term in the industry.
00:01:00
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We at Kevin treat it a little bit differently and not just gut health as a broad term, but we like to dive a little bit deeper and what does that actually mean in the animal.
00:01:11
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But overall, a critical contributor to the overall health performance and welfare of the animals.
00:01:19
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I don't think it comes as any surprise as a...
00:01:23
Speaker
Continued efforts to sustainability and the focus by different companies up and down the entire value chain from animal feed to consumer packaging, that sustainability will continue to be a focus.
00:01:34
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We have some concerted efforts going on with that currently within KEMIN.
00:01:40
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And just the volatility with the markets in general over the past, in the industry over the past two to three years.
00:01:48
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out of the diets that we feed the animals.
00:01:51
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And there's certainly a lot that goes into that, but Kim is just a piece of that entire chain and how folks can, producers can utilize additives and technologies to ensure optimal use and making sure we're educating the producer and the consumer the best way we can in order to make smart decisions to improve the
00:02:19
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Mark, are you watching any other different trends this year?
Industry Challenges: Market Volatility and Labor Shortages
00:02:22
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You know, I think Cody captured it very well.
00:02:25
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The needle on gut health has yet to be really defined.
00:02:28
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And I think that as an industry, as industries, we are always trying to really dial that in more.
00:02:36
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One of the things that I think is really the big question is, is what do we, you know, what value proposition can we do or can we take to our customers?
00:02:47
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And then how do they then
00:02:49
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bring that down the chain to their customers.
00:02:52
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Because a lot of this is consumer driven.
00:02:54
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We wanna make sure that not only are our customers educated, but our customers are educated on exactly what value they're doing to provide in the protein industry.
00:03:06
Speaker
And Mark carrying on that, what challenges and opportunities will the feed and animal nutrition industries face in the near term?
00:03:14
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Well, if history has been a teacher for us the last few years,
00:03:20
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it's been kind of a moving target in terms of volatility.
00:03:24
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You know, there's, if we looked at where we were at this time last year, the markets were in a very tough spot across most of the protein industries.
00:03:33
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And a lot of that was labor driven.
00:03:37
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Where we're at right now, you look at market volatility.
00:03:40
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I know that the chicken market right now specifically is they're in a tough period.
00:03:47
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You know, even on the pork side, I think that they're having a little bit different experience in the turkey business as well.
00:03:56
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So it's very difficult to talk about challenges without looking at, you know, just inflation.
00:04:04
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So looking at the impact that inflation has and, you know, overall rising input costs, I think it's really challenged our customers to take a hard look at exactly what they're doing.
00:04:17
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in terms of how they're impacting their overall profitability and looking at how, you know, with the feed additive business, it's such a broad business now.
00:04:29
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What are companies like Kim and how are they bringing value to their customers when you're looking at market volatility, inflation, rising input costs, labor shortages,
00:04:44
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and an ever-changing regulatory market, I think that it's very difficult to pinpoint one or two things that have a big challenge.
00:04:55
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I'd say it's just a potpourri of all these things mixed together.
00:05:00
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And it presents companies like Kemen and even to a larger extent to the industry, what are we doing that is gonna help our customers in the very end,
00:05:14
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to become profitable, not only profitable, but are continuing to provide the most safest, the most economical protein in the United States and the world to that extent.
00:05:27
Speaker
Cody, are you seeing any unique challenges and opportunities in the cattle industries or do these all kind of carry over all the industries?
2023 Cattle Market Outlook
00:05:35
Speaker
Yeah, good question, Ann.
00:05:36
Speaker
I think Mark put up a big enough umbrella there to capture really the main pieces throughout all industries and through all species.
00:05:44
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Just an example from the cattle side that alludes to Mark's points is 2023 looks to be a start of a great year in terms of the markets for cattle with beef demand remaining relatively steady.
00:06:01
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and cattle supply is tightening over the course of 2022.
00:06:04
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And so that means good things for the markets from that standpoint.
00:06:08
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What Mark had touched on was just really the input costs and the inflationary reasons that maybe there's more volatility outside of what we're putting into these operations than there has been before, but also knowing that we can expect a pretty good return
00:06:28
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on our investments, you know, here in the coming year as well.
00:06:31
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So it's, you know, it's very consistent throughout industries.
00:06:36
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I think the biggest thing from a Cayman standpoint, when we look at what is our opportunity in that, and I alluded to it before, is just the education piece of it.
00:06:46
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And, you know, people have so much information at their fingertips now.
00:06:55
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that and educating the producer consumer.
00:06:59
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And there's such a thirst for knowledge, I think more so.
00:07:02
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If you date back 10 or 20 years, obviously that landscape looks a lot different, but typically our customers and the end user consumer is more educated today now than they were then.
00:07:17
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But we can use our areas of expertise and what our focus is
00:07:24
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continue that education with those folks in order to, again, make more conscientious decisions and really work towards doing this in partnership with them so we can better serve the industry.
00:07:38
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Cody, do you see any of the recent challenges such as feed costs, ingredient availability, and supply chain easing in the coming year?
00:07:45
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I do.
00:07:46
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I think we've already seen a little bit of easing amongst the categories that you just mentioned.
00:07:55
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When I talk about, as we date back 10 or 20 years, and you fast forward to today, we're in an increasingly global market as opposed to just thinking about the U.S. or North America.
00:08:07
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I think what the last couple of years have done is certainly uncovered some pain points and maybe uncovered
00:08:14
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the root causes of some of those pain points and probably made us smarter in terms of the things that we need to address as opposed to just addressing the symptoms.
00:08:25
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And that's obviously easier said than done because some of those issues take time to rectify.
00:08:32
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But as we've kind of felt the ripples of COVID and some of those economic uncertainties, I think there's signs that we're working ourselves out of that.
00:08:41
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But I think in terms of
00:08:43
Speaker
the industry kind of getting used to that new norm, whatever that is, will still take a little bit of time to experience that.
How does gut health impact animal welfare and productivity?
00:08:53
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Mark, you and Cody both mentioned gut health as a big trend that you're following, and it certainly gained popularity in recent years.
00:09:00
Speaker
How does gut health affect an animal or a bird's overall health and productivity, and why is it so important?
00:09:06
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I mean, gut health equals animal health.
00:09:08
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There are so many different factors that go into gut health and why it becomes important.
00:09:12
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just to not the animals, but the birds overall health and productivity.
00:09:16
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You know, one of the, if you look at the list of priorities for our customers, number one is, you know, animal welfare.
00:09:24
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It's a, that's a really big part of what our customers and their focus is, is to make sure number one, they're taking care of their animals, their birds and gut, the role that gut health plays, it's just looking at the microbial balance.
00:09:40
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intestinal integrity and the immune function, those are all key components to everything that rolls up into gut health.
00:09:47
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I think the opportunity that we've had is to create a dialogue with our customers just to understand fully what their definition of gut health is.
00:09:57
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How do they see gut health and the impacts with their animals and their birds?
00:10:03
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And then what can KEMIN do
00:10:06
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based on this knowledge to continue to innovate and bring new solutions to them.
00:10:11
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I think it's, you know, before it was more like the wild west.
00:10:16
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Now we're starting to zero in a little bit more on, you know, understanding some of these broad concepts.
00:10:22
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And I think that, you know, Cody's got a really good story that he can tell about the equine business.
00:10:30
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And that's just a good example of one of the ways that Kim has been able to bring, you know,
00:10:36
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their knowledge of gut health and apply it to a specific industry.
00:10:40
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Yeah, to Mark's point, in 2017, Kevin started the equine business.
00:10:45
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And really the objective of that was to translate some of the successes in the improvement in animal health and performance from what we've typically, what we've learned on the livestock and production side.
00:11:00
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and turned a little bit more towards the equine side and specialty side, a little more hobby as you think of it.
00:11:07
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So we started that business in 2017.
00:11:10
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And one of the things we learned throughout all of that that we've since transposed, you know, it kind of comes full circle that we transpose back into the livestock production side is is how we speak and how we speak to the consumer and making sure that that the way we speak to our customer
00:11:29
Speaker
Certainly on the equine side, it's a little bit different mentality and that our customers can reiterate those same points of the importance of what we have to offer from an intestinal health standpoint and what it means to the animal, that we had a great opportunity to do that.
00:11:47
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And that's really where the education piece began in terms of health is us being able to talk to our customer and then being able to relay the
00:12:02
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have the education or experience or knowledge base, there's some of those folks that are making those decisions to formulate those feeds, et cetera.
00:12:09
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And so we played an integral part in that.
00:12:12
Speaker
And that really started from what I'd mentioned prior was treating gut health as a, yes, it's a broad term, but diving deeper about what are the aspects of gut health that matter.
00:12:24
Speaker
And what are the different pieces of it when Mark talks about really the microbial balance and the intestinal integrity and immune function and the part that we play on that and how we can educate on why that's important on why gut health equals animal health.
00:12:38
Speaker
A good example now on how we've transposed that is in the cattle industry.
00:12:42
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I think typically in the past, they've been used to discussing rumen health and think that I think they fought 10 years ago that that was an all encompassing term.
00:12:53
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that meant really anything that went on inside of the cow.
00:12:58
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And I think we've learned over the course of, especially the last few years, is that intestinal health and rumen health are two different things and they're two distinct things.
00:13:07
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Again, offering us the opportunity to help educate our customers and producers on what that means and the impact that can have in the industry as a whole, but then to their operations specifically.
00:13:20
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And Mark, on that point of education, do you see your clients drawing the line between gut health and animal welfare, or do they still kind of think that a healthy bird is a productive bird, but they don't really look at the welfare side of it?
00:13:34
Speaker
Well, I think it's difficult to draw a line when you're talking animal welfare, gut health.
00:13:41
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I think it's more about the overall, I'd say the overall welfare of the bird or the animal.
00:13:48
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And when these
00:13:50
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you know, when you talk to these customers, they really are focused, hyper-focused on welfare being probably the most important aspect of everything that they do.
00:14:01
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Not only do they want to produce a high quality product, but they want to do it in the most safe and effective way that they can.
00:14:09
Speaker
And I'd say, I'd go back to a little bit of what Cody was talking about.
00:14:14
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Kimmon has been very intentional about trying to not only
00:14:18
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build upon this gut health platform that we've developed, but also provide that education piece.
00:14:24
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And I'd say for the last four years, as a result, Kemen has done an intestinal health symposium that we provide as an educational opportunity that has been global, that's brought together a lot of different gut health experts in the swine, poultry, beef, dairy, and equine industries.
00:14:44
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And
00:14:45
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And I'd say it's been a very nice launching pad for us to take our understanding as a global company and coalesce together with our customers to try to build upon how we can tie gut health with animal welfare and then how it affects every other part of the value chain to our customers and to their customers in the end.
Role of Feed Additives in Gut Health
00:15:09
Speaker
What types of feed additives can promote gut health and how do they work?
00:15:13
Speaker
So again, as we mentioned, you know, we look at it from a comprehensive approach.
00:15:19
Speaker
No one additive is going to be a silver bullet.
00:15:23
Speaker
And we understand that.
00:15:24
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And I think over time that the industry has understood that as well, that you really have to focus on certain areas.
00:15:32
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And that's really what our strategy is, you know, as we go to obviously go to market, but also as we innovate.
00:15:42
Speaker
And so first, as we talked about before, when we talk about those three areas of gut health, and we term it cleanup, buildup, and knockout, which are those areas that address microbial balance, the integrity of the intestine, and immune function, those are the three real areas that we are looking at.
00:16:02
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And so you can look at a number of different additives, but really what we're talking about is what can we clean up?
00:16:09
Speaker
So from a water disinfectant feed standpoint, what can we clean those up before they even get to the animal or stabilize those?
00:16:18
Speaker
The second piece of it is buildup.
00:16:22
Speaker
So how can we build up the integrity of the intestine in the animal?
00:16:26
Speaker
So a lot of times over the past few years, folks have probably seen
00:16:32
Speaker
the terminology around leaky gut.
00:16:35
Speaker
And really that's the term that we're trying to address when we talk about the integrity of the intestine and making sure that's operating at its optimum.
00:16:49
Speaker
And then the last piece is the immune function.
00:16:52
Speaker
When you talk about an animal getting sick or being compromised, that causes a huge glucose sink in the animal.
00:17:00
Speaker
And so any way that,
00:17:02
Speaker
we can improve that immune system by clearing more glucose, that we have the ability to do that as well with one of our products.
00:17:12
Speaker
And then we also have the ability to knock out the harmful pathogens that are in the animal as well.
00:17:19
Speaker
And so then we're talking about some of our active microbials to be able to do that.
00:17:24
Speaker
Mark can expand on those.
00:17:26
Speaker
Yeah, Cody, I think captured it really well.
00:17:29
Speaker
There's so much information out there right now, because there's a lot of companies that are bringing different feed additives to the table.
00:17:36
Speaker
And it's been a challenge for our customers with this information overload, with all the new ingredients that are flooding the market.
00:17:46
Speaker
And I think what Kemen has done over the last couple of years is to try to build a program approach that we can simplify
00:17:56
Speaker
if you say how we provide our products and the impact that our products are gonna provide to the animals.
00:18:05
Speaker
And it's not, like Cody said before, there's not just one product that's gonna help.
00:18:10
Speaker
I mean, historically, a lot of the tools that our customers have used, they've gone away.
00:18:16
Speaker
And we've had to become very innovative in our approach on how we treat animals.
00:18:24
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And a lot of it is trying to just
00:18:27
Speaker
preventative at this point.
00:18:29
Speaker
And so I look at just trying to give our customers the most educated opportunity that they can implement a program without trying to clouding up too much with all the information overload
Managing Stress and Education in Animal Nutrition
00:18:47
Speaker
that's out there.
00:18:47
Speaker
So like I said, it's not necessarily a
00:18:51
Speaker
A simplification, more of a zeroing in on what we can do specifically with our products and the value they provide to their animals.
00:18:59
Speaker
Well, Mark, at the risk of that information overload, do you have any other things that can be done on farm to promote good gut health besides just additives and these other things that you have already discussed?
00:19:11
Speaker
Sure.
00:19:11
Speaker
One of the things that I think that we can help to do is just understanding the interconnectivity of stress and gut health.
00:19:18
Speaker
How do they tie together?
00:19:20
Speaker
How does that, where is that impacted on the farm?
00:19:23
Speaker
What can we do as a feed additive company to help to educate our customers about taking the measures to reduce those, you know, and manage the stress at those known intervals, be it weaning, transportation, diet changes, you know, what effect do our products have in these certain periods of stress?
00:19:48
Speaker
And finally, I'd say just working with our customers, number one, to better understand their operations so we can continue to have a dialogue on how Kamin can create continually to develop innovations that will help the impact on farm and then down, you know, ultimately with the consumer level.
00:20:12
Speaker
All right, Cody, anything to add there?
00:20:15
Speaker
No, the only thing I would add is, you know, Kimmon is just certainly a piece in that whole chain of getting a animal from farm to fork, so to speak, and what is the best way to do that.
00:20:31
Speaker
And we're just, we're one piece of that puzzle.
00:20:34
Speaker
And there's a lot of pieces that go into making that efficient and efficient.
00:20:43
Speaker
you know, when you have a car or truck motor and it takes a lot of parts to make that run, um, to, to get the utmost performance out of it.
00:20:52
Speaker
Raising an animal is very much like that in that, um, is that we have to optimize all parts of that, that, the, that animal's life, uh, in order to get the most out of that and for the producer to get the most out of that.
00:21:06
Speaker
And so it's not one thing, it's several things.
00:21:10
Speaker
And, um,
00:21:15
Speaker
part of that and offer what we can from our expertise in order to make that happen and serve our customer base and serve the industry.
00:21:26
Speaker
Well, thank you both of you for taking the time to talk to me today.
00:21:29
Speaker
This was very interesting.
00:21:31
Speaker
Thank you.
00:21:32
Speaker
Thank you for having me.
00:21:32
Speaker
And thank you to the audience for tuning in.
00:21:34
Speaker
You can go to kemin.com slash ag to learn more about the topics that Mark and Cody discussed here.
00:21:40
Speaker
I'm Ann Roos for Feed Strategy.