High feed costs, the strong Canadian dollar and US Mandatory Country of Origin Labelling have dramatically impacted the profitability of Canadian livestock producers, particularly beef and pork producers.

Herb Schultz, the Animal Nutrition Association of Canada's Manitoba operations manager, says feed manufacturers have been challenged to find low cost ingredients.

Clip-Herb Schultz-Animal Nutrition Association of Canada:

There's a real glut of distiller dried grains out there and those are running awfully cheap compared to other feed ingredients.

That right now is sort of saving a few of the producers because our mills can actually reduce the costs to the livestock producers.

In beef cattle it's not a problem, you can feed a quite a few DDGS.

In hogs you can't, there's a limit at which point the quality of the carcass gets affected.

So, quite frankly, it's because DDGS are quite cheap right now that some people are sort of meeting their break even but if, for example, that price had to go back up to where other feed ingredients like barley or feed wheat or corn were that would be a pretty stiff bill to send a hog producer or a cattle producer.

The other thing they're doing is micro-ingredients or stuff, there's a lot of stuff that you can add to improve the robustness of your livestock herd, producers are not going to the feed mill and buying too much of that.

It's all being sort of carefully considered before you do that. Schultz says, unless specific ingredients are requested, the nutritionists in these mills are making sure they provide the lowest cost ingredient that will meet nutritional requirements.