Cut Animal Health Costs, Urges VetWednesday, April 15, 2009
Veterinarian Doug MacDougald offered delegates at the 2009 Banff Pork Seminar four pieces of advice on how to trim animal health costs.
In times of economic distress, many would agree that there are only two fundamental solutions: invest aggressively and hope for the best (think the US government) or cut costs dramatically. Pork producers know the latter message all too well and probably wonder how they could possibly cut their expenses even more.
However, veterinarian Doug MacDougald says there are still opportunities to reduce animal health costs through better production and financial analysis. There is also still room for improvement on return on investment (ROI) for animal health products on most hog farms, he says.
The pig industry, says Dr MacDougald, is marked by generally poor production and financial analysis. This means poor assessment of ROI for interventions and little focus on opportunity cost. However, research based on finishing pig group opportunity costs calculated on mortality, culls and feed conversion to target reveals startling results, with the best to worst sites varying by $11 per pig, with the widest variance per site at $34 per pig.
"This is, in my experience, representative of this industry, not economically sustainable and for an individual herd to improve on this delivers a significant competitive advantage," he says.
- Be critical of product technical information
Be critical of general mass marketing of product technical results and ROI analysis from the animal health industry, says Dr MacDougald. "Individual herds vary considerably in disease status, prevalence of disease (as opposed to the prevalence of the pathogen), disease stressors and need for animal health product 'insurance'."
Dr MacDougald highlights this with an example of the potential cost savings of an altered animal health programme. A programme that removes erysipelas, leptospira and parvovirus (ELP) vaccines at weaning (-11 cents per pig weaned), removes E.coli vaccinations for pre-farrow sows (-10 cents) and eliminates de-worming (-8 cents) but puts in place monitoring of parvovirus serology/faecal flotation three times a year (+1 cent) results in a total savings of 28 cents per pig weaned, he says.
- Focus on the primary pathogens – big bugs, not little
Producers must do accurate and timely diagnostics, work closely with their veterinary and diagnostic team, and remember that biology is not black and white or time static, says Dr MacDougald. "For example, intervening with antibiotics and/or vaccines chasing nursery 'suicide' bugs without addressing PRRSV circulation is a band-aid, not a long term health strategy."
- Monitor product usage
Incorrect product orders, wrong dosages of vaccine, accidental changes to treatment or vaccine protocols can all have an impact on the bottom line, says Dr MacDougald, who recommends a pharmaceutical cost analysis by month and reconciliation of key products on a per-pig basis to track trends and actual animal health costs.
- Manage lightweight pigs
Focusing on this sub-population, which significantly influences weight gain and mortality variation, will lead to more cost effective animal health product decisions, better opportunity costs and long term health management strategy, says Dr MacDougald. "Note that sow herd pathogen stability is a piece of the lightweight, compromised pig puzzle that is often overlooked."