By Ben Allen – CEO, BinSentry
Agriculture too often lags behind other sectors when it comes to adopting new technologies.
Not because food producers are tech-phobic — but in an industry where margins are tight and competition fierce, they’ve been disappointed often enough that they prefer the status quo over betting the farm on the latest unproven gadget.
Yet, there’s never been a more urgent time for feed millers and protein producers to harness new technologies, including artificial intelligence (AI), that can help them feed the world while making their businesses more efficient, more profitable and more sustainable.
Here’s the thing: AI is already here.
It’s being used to develop better vaccines and improve nutrition for livestock and poultry.
AI is reshaping logistics and supply chain efficiency.
It’s improving genetics research.
At BinSentry, we’re using AI to revolutionize animal feed supply chains.
AI is replacing manual processes and bad data
The animal feed supply chain for poultry and hog producers is ripe for efficiency improvements.
For decades, the feed industry has relied on spreadsheets, paper and manual feed inventory estimates to manage feed orders and set delivery schedules. In practice, that means workers at most feed mills and farms are still banging on bins or climbing ladders to look inside dark, dusty holes to “guesstimate” feed levels.
All you get from this is bad data — and it costs time and money all along the supply chain. Not to mention the financial and personal costs of injuries due to falls.
The U.S. alone moves $110-Billion worth of feed every 12 months, and at the same time, there’s still almost no visibility into the supply chain.
Fortunately, that’s changing. Major companies are moving to deploy BinSentry’s AI-powered sensors and software to run their animal feed supply chains.
Here’s what it means for them:
- Sensors monitor feed consumption in real time at the source of consumption: swine and poultry barns. AI software crunches the data and places feed orders.
- At the feed mill, AI programs use sensor data to set production schedules and order ingredients.
- AI programs set delivery schedules based on real-time data from the farms and the mill.
The AI advantage
Early AI adopters will have a HUGE operational advantage over the laggards: lower costs, higher profits, and more room for investments to create even more operational advantage.
Here’s what that operational advantage looks like for BinSentry customers:
- Transportation costs: 12% lower
- Hours spent tracking inventory: 95% lower
- Out of feed events: 75% lower
- Feed returns: 65% lower
Animal feed represents 60% to 70% of total production costs in the swine and poultry sectors. So any tool that can reduce feed costs will have an immediate impact.
Lowering feed conversion ratios for higher profits
Here’s just one example:
A recent study by BinSentry and leading pork producer HANOR showed that the vast majority of feed outages are caused by feed bin slide management errors — not running out of feed on site. This previously undetectable problem — identified by BinSentry’s AI-powered sensors and software — increased feed conversion ratios by up to 7 points.
This amounts to about $3.15 in added costs per pig, or about $4,500 per barn annually.
Multiply that by tens of thousands of hog barns across North America, and you’ve got a gigantic drain on profits that can be easily fixed with currently available technology.
Both producers and the feed sector have everything to gain — and only their mallets and spreadsheets to lose — from advancements in precision feed monitoring, supply chain management and planning that are made possible by AI.
Bottom line: adopting AI technology lowers feed costs by up to 5%, which translates directly to increased profitability.
The companies that do this will outperform the companies that don’t do this by a wide margin.
It’s just that simple.
