Why digitally mature companies fare better

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When you think of a “digitally mature company,” what do you see? The term might conjure up images of tech-savvy millennials in Silicon Valley, but digitally mature companies are all around you—in every industry, in every corner of the globe. They’re enterprises that have embraced digital technology to transform the way they do business and connect with their customers.

digitally mature companies fare better

So what does a digitally mature company look like? It’s an enterprise that:

  • Has clarity of purpose and vision, and is committed to achieving it
  • Invests in people, processes and technology to support its objectives
  • Keeps evolving as new opportunities present themselves and new technology emerges

Digital maturity correlates with a better bottom line

However you define it, digital maturity matters—and the research shows a direct correlation between being a digitally mature company and having bottom line success.

The economic benefits of digital maturity are well documented. A McKinsey study of 2,400 companies found that those able to exploit ICT to boost efficiency grew revenue 3.2% faster annually than their peers over a five-year period. Another study looked at more than 180 publicly listed companies from around the world, finding that digitally mature organizations outperformed their less mature competitors across all financial measures. This included a return on invested capital (ROIC) 50% higher than laggards.

In an increasingly digital world, companies that embrace technology are simply becoming more competitive and profitable than those who don’t. And it’s no wonder that digitally mature companies have a competitive edge. According to the 2016 State of Digital Business Transformation study conducted by SAP, organizations that see themselves as digitally mature outperform their peers in terms of net income by 20%. In fact, those with advanced digital capabilities enjoy a 42% net income margin compared with 18% for those without any digital capability.

High-maturity companies report

According to PwC’s Annual Global CEO Survey, digitally mature companies are out-performing their less digitally mature peers by 53 percent when it comes to revenue growth over the past three years.

Research shows that digitally mature companies are significantly more likely to have revenues over $1 billion than their digitally novice counterparts. And the larger the enterprise is, the greater the gap in revenue. For example, 50% of large enterprises with strong digital maturity have annual revenues over $1 billion, compared with only 10 percent of small organizations with weak digital maturity.

The numbers show an undeniable trend and help shape an answer to the question “why do digitally mature companies have better results”.

  1. They have resources – or they choose to invest in resources – that a) make processes easier, from operations to accounting, and b) help key stakeholders understand strengths and weaknesses, from tracking shipments to tracking customer journeys.
  2. Digital resources facilitate in-company communication, transparency, and speed of movement and reaction.
  3. Resources are freed up by these facilitated processes and communications, increasing overall productivity.
  4. The ROI of digitalization and digital transformation reflects in the company bottom line.

Moving toward digital maturity in every aspect of the business

A digitally mature company can be defined as a business that has invested in digital technologies to transform the way it does business to enhance customer relationships, improve employee engagement, and streamline processes.

Digital maturity is not just about having the latest gadgets or software packages. It’s a holistic approach to using technology to create value and transform your organization into one that can compete and win in today’s marketplace.

Many organizations are still struggling to make this shift. Their strategies for deploying digital technologies are often limited, and their applications are not fully functional or properly integrated. They don’t have the right tools or the right talent to execute on their plans. As a result, they’re increasingly vulnerable to disruption from start-ups, new entrants, and other competitors who are much more adept at using digital technologies to achieve competitive advantage.

Digital maturity is also essential for any organization seeking to achieve great things through innovation – whether bringing new products or services to market or delivering an enhanced experience for customers.

But digital maturity does not come easily – or quickly. If a company has reached maturity, it’s probably because the management team has been working on it for years. They’ve had plenty of time to get the details right. They’ve also built a solid customer base and cultivated positive relationships with partners along the value chain. In other words, the sooner you set off, the faster you get there.

Conclusion: Long-term digital transformation is a matter of survival

In the last decade, organizations have begun to realize that they must implement a digital approach to their business if they want to stay competitive. In the last few years, we’ve seen many companies begin to make this shift.

What does it take for an organization to become digitally mature? There are four components:

1)        Business strategy. Companies that put together a digital strategy from the top down with support from the board are more likely to move forward than those that don’t create one.

2)        Technology strategy. A technology strategy is essential for development, but it must be in line with an organization’s overall business goals.

3)        Governance. Establishing governance structures can help organizations focus on what’s most important during times of uncertainty.

4)        Employee skills. Organizations need a skilled workforce to be successful digitally, but training and development aren’t enough—digital maturity programs must be incorporated into daily operations.

Truly digitally mature organizations—that is, those that are able to reap the benefits of digital transformation—are already seeing demonstrable results. They’re seeing a return on their investment of time, money and resources; they’re becoming more efficient and effective; and they’re capturing new revenue streams.




Why caring about climate change is good for your business

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climate change is good for your business

by Technical Team, EW Nutrition

The Glasgow Climate Pact reached at the COP26 summit this November sent a clear message to businesses across the globe: Put sustainability on top of your corporate agenda or risk losing out. But how can food and feed producers translate the knowledge that climate change is happening into good business decisions? What impact is it causing, and which actions can we take today?

Why climate change is such a big deal

There is an overwhelming consensus among scientists that climate change is happening and that we need to stop it. Long-term changes in global temperature and weather patterns are nothing new. What is new is that these shifts are primarily driven by human activities.

Activities such as burning fossil fuels, livestock farming, and deforestation release carbon dioxides and other greenhouse gases (GHG) into the atmosphere. GHG trap the sun’s heat and cause average temperatures to rise.

Diagram of global average temperatures from 1850 to 2020
Copyright: Ed Hawkins, National Centre for Atmospheric Science, University of Reading

Compared to the pre-industrial era, average temperatures are now 1.2° C warmer. That doesn’t sound like a lot. But the effects are disastrous and disproportionately so for people in low-income communities and developing countries.

Climate change is already causing sea level rises, threatening coastal regions, and ocean acidification, which disrupts global seafood supplies. Unprecedented losses in biodiversity are compromising food security and ecosystem services (such as pollination and irrigation). Biodiversity losses also expose us to zoonotic diseases – for example, the ongoing COVID-19 pandemic has zoonotic origins.

Due to climate change, the frequency and severity of extreme weather events are increasing. As countries in Europe and China experience historic rainfall and flooding, other parts of the world, such as Australia, the western US, and many African countries, face intense droughts. With further warming, Pacific islands will disappear under rising sea levels. And regions such as the Middle East will suffer from extreme heatwaves and see farmland turn into deserts.

How climate change affects agricultural businesses

While some crops and areas benefit from higher temperatures and changed weather patterns, on the whole, it is becoming more difficult to feed the world. Extreme weather events such as droughts, floods, hurricanes, heatwaves, and wildfires pose severe challenges for agricultural businesses.

Agricultural production costs are and will be increasing further because climate change effects entail water scarcity, raw material shortages, higher energy prices, and stiffer competition for land as certain areas become climatically unsuitable for production.

Rotten corn cob
Microbial contamination by toxigenic molds threaten human and animal health

Feed and food crop yields and quality suffer both from torrential rain and flooding and heat waves and droughts. Researchers from the University of Minnesota have found that climate change is already reducing global rice yields by 0.3% and wheat yields by 0.9% on average each year. Another study showed that every 1° C increase in global mean temperature would, on average, reduce global yields of wheat by 6.0%, rice by 3.2%, maize by 7.4%, and soybean by 3.1%.

We also see increased problems with pests and diseases. Pests already destroy 40 % of global crop production each year. As temperatures rise, pests from fall armyworms to desert locusts expand into new territories. Due to warmer temperatures, disease vectors such as mosquitoes, flies, and ticks also proliferate and migrate, carrying new pathogens to previously unexposed livestock. Additionally, decreased forage quality, heat stress, and water shortages already compromise livestock immunity.

And let’s not forget that the wellbeing and safety of the workforce are directly affected by climate change effects such as extreme temperatures and reduced air quality. This is even more true for outdoor workers and the 143 million “climate migrants” we expect to see by 2050. Climate change has also triggered a significant cultural shift, especially in younger generations. The climate-conscious GenZ talent only wants to work for employers who genuinely commit to sustainability.

Let your business thrive despite climate change

Global warming must be limited to 1.5° C to avert the most devastating impacts. To achieve this, we have to cut greenhouse gas emissions in half by 2030. And by 2050, the world has to reach “net-zero” emissions, i.e., removing as many greenhouse gases from the atmosphere as we release into it.

Climate change regulations are becoming more stringent, especially for the energy, transport, and agricultural sectors. As UN High-level Climate Action Champion Nigel Topping puts it:

“If you haven’t got a net-zero target now, you’re looking like you don’t care about the next generation, and you’re not paying attention to regulations coming down the pipe. Your credit rating is at risk, and your ability to attract and keep talent is at risk.”

What can we do? Agriculture is unusual in that its contribution to anthropogenic climate change mostly comes from methane and nitrous oxide instead of carbon dioxide.  Nitrous oxide emissions stem from soils, fertilizers, and manure, while ruminants and rice cultivation release methane.

Across these sectors, much more needs to be done at the policy level to incentivize sustainable husbandry, knowledge transfer, and targeted R&D. Still, wider adoption of existing best practices and technologies would help the global food and feed sectors to be more resilient and substantially reduce its GHG.

Enhanced efficiency fertilizers can reduce nitrous oxide emissions from soils, while phytogenic feed additives curb methane emissions in ruminants. And exciting research on topics such as pheromone-based pest control shows that climate change adaptation opens up new business opportunities.

Spend time on a detailed review of your company’s climate impact. This will reveal opportunities for emission reductions and decarbonization, both in your direct operations and along the value chain. More energy-efficient compound feed production, for example, helps feed mills but also improves the carbon footprint of the final animal products. And in times of Agriculture 4.0, investing in digital technologies, platforms, and processes will be vital to identifying and capitalizing on new business opportunities for climate-conscious production.

No one bears the brunt of climate change quite as intensely as agribusinesses. Let’s champion sustainability for improved corporate reputation, stronger risk management, long-run cost savings, market access, and attracting and retaining qualified employees and customers.

 




The top 5 challenges for businesses in 2022

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By Technical Team, EW Nutrition

 

COVID-19 is definitely still a concern across the globe. With only about 47% of the world fully vaccinated, chances are we will not see the end of it next year. And with the unequal distribution of vaccines, globalization will keep bringing it home.

However, while everyone has an eye on the disruptions caused by COVID-19 to businesses and society in general, there are other looming challenges to prepare for. Here is a brief look at the top 5 challenges that rose to the surface in 2021, which are forecast to cause even bigger waves in 2022.

top 5 challenges for businesses

Sustainability: Accountability – and accounting

Greenwashing doesn’t wash anymore.

In 2021, sustainability has become an unavoidable topic not just for ecologists and (once a year or so) heads of state, but also for businesses and the masses. With extreme weather phenomena looming large in the news, climate change has become a fact of life. It no longer needs to be accepted as much as it needs to be managed.

The challenge is twofold. One the one hand, businesses need to demonstrate corporate accountability by monitoring the environmental footprint of their activities. On the other hand, businesses need to preserve the financial viability of their sustainability initiatives.

The balance between accountability and financial viability is still hard to find. Sustainability in business is an expensive proposition. Not only is it costly to implement fully sustainable measures, but finding the sustainability hotspots in your value chain and retrieving the data is sometimes nearly impossible. And, while reporting for scope 1 and 2 is somewhat easier, scope 3 accounting is still a tough nut to break.

Based on the Greenhouse Gas (GHG) Protocol, emissions are divided by source into 3 major scopes:

Scope 1 – direct emissions of the reporting company. This includes owned or controlled sources such as company facilities or company vehicles.

Scope 2 – indirect emissions from consumption. Here are included purchased electricity, steam, heating and cooling for the company’s use.

Scope 3 – all indirect emissions along the value chain. Under scope 3 fall upstream and downstream emissions through purchased goods and services, capital goods, processing, transportation and distribution, waste, use of sold products, and much more.

GHG Protocol

Source: GHG Protocol

Nevertheless, the equation must balance. A study by Pew Research Center shows that sustainability and addressing climate change are not just thoughts, but immediate concerns for the younger generation. Gen Z (people born between 1997-2012) are actively engaged in following and/or combatting the effects of climate change. Research by Deloitte indicates that, for Gen Z, climate change and protecting the environment are the top concern.

When your upcoming workforce demonstrates such strong interest, it is remiss to ignore it.

Climate challenges: Prepared for extreme weather?

This is getting serious.

Deadly snowstorm in Spain in January. A deadly heatwave that killed 569 people in Canada in June. Deadly floods that affected western Germany, The Netherlands, and Belgium in July. Deadly fires that raged across Italy and Greece in August. And many more deadly extreme weather events whose roots lie in climate change.

They are not just a reason to join the fight for sustainability. They are, in more immediate terms, a reason to examine how well your business is prepared to face the next extreme weather event. Because it is definitely coming. And it may affect your business – possibly directly, depending on your location, but definitely indirectly. The impact of resource scarcity could already be felt this year, when extreme weather events around the world affected harvest quantity and quality. Coffee and sugar futures have been on the rise for years, and so have wheat prices.

Macrotrends

Source: Macrotrends

In fact, according to a 2021 Deloitte report, companies are actively concerned about the impact of climate change issues on their activities, with climate-related disasters topping the list and scarcity of resources a close second.

2021 Deloitte report

Source: Deloitte

Being prepared for extreme events means, in most cases, managing risks across company facilities, as well as across the value chain. The more widespread and varied the production footprint and sourcing capabilities, the better can a company weather the storm.

Supply chain issues: No end in sight

No, it’s not getting better soon.

ICIS shipping chart
Source: ICIS

In fact, after over a year of constant disruptions, problems have accumulated into a perfect storm. Unpredictable demand and availability, as well as unpredictable labor shortages, both due to COVID-19 and various side-effects and accidents, have pushed container availability and port unloading infrastructure into a frenzied downward spiral. While container prices have gone up (over $20,000 for a standard container coming to the US from east Asia), ports have been unable to handle the incoming ships’ unloading needs.

Some ports have already moved to 24/7 operations, yet the issues will take much longer to fix – and prices are not likely to come down in a hurry. However, reliable forecasting in such turbulent times is nearly impossible.

In these circumstances, old wisdom can be reactivated. Instead of the cheaper and more agile just-in-time model that many companies practiced, increasing safety stocks and developing a wider global footprint are going to be the norm. On top, developing excellent relations with suppliers and managing customer expectations are critical. As Dan Swan, McKinsey Operations expert, put it: Supply chains are no longer a “necessary evil”, but more and more “a real differentiator for companies”. Product availability is the new name of the game.

In the meantime, expect prices and lead time to remain high for quite a while yet.

Digitalization: Keeping up with the world

To the surprise of no one with any knowledge of markets, a 2019 study by Deloitte confirmed that businesses on their path to digital transformation tend to perform better financially. In the meantime, COVID-19 has accelerated this trend. With the Zoom boom and remote working, digital communications have become the norm – and time is not going back. In 2022, a mature company should also be a digitally mature company.

What does digital maturity mean? By and large, according to Deloitte’s concept of “pivoting to digital maturity”, it means that organizations use data and technology “to continuously evolve all aspects of its business models—what it offers, how it sells (interacts with its customers) and delivers, and how it operates”.

In 2022, organizations will feel even more under pressure to step up: connecting employees across multiple locations, integrating “business technologists” into their organigrams and empowering them to bring digitalization home, agility through autonomous modular processes, automation in every possible quarter, and more.

In some sectors, digitalization is self-implied. ICT, media, finance, and professional services are more digitally advanced than others. Logistics, retail, and other industries that rely on distributed databases will also make progress. However, even in agriculture and animal production, where most outsiders still picture tractors and barns, the fourth revolution is in full progress. The power of data, the possibilities brought by the cloud, the ease of synchronous communication will impact even the most conservative industries. Whoever is not prepared for digitalization will inevitably fall behind.

Human resources: Labor shortages, happynomics and more

How is it possible to have both high employment and labor shortages at the same time?

#2 on the list of concerns for Gen Z, as evidenced in Deloitte’s research, is unemployment. And yet, the evidence is mounting that most companies (nearly 9 in 10, in one study) are having trouble filling certain positions – especially entry- and mid-level.

Deloitte’s research report

Source: Deloitte

In the US, analysts have been scratching their heads at a disconnect between 8.4 million unemployed and 10 million job openings, with radical differences in sectors such as professional and business services or education and health services.

Most answers focus on the realities of the “Corona times”. People who were forced to work remotely discovered that they enjoyed it. They left inflexible jobs for more flexible ones – or just to spend more time with the family.Job Report

At the same time, childcare insecurity made it compulsory for some parents to give up their jobs to be home for children whose schools or care centers were closed in lockdown.

Workers in retail and hospitality, who saw their jobs being threatened, again and again, by COVID-19. Many were furloughed or sent into unemployment. While out of work,  unemployment benefits allowed people to reconsider career paths – and many decided to move to more secure industries.

And, finally, workers whose jobs are not threatened fall prey to burnout during intense work-from-home bouts during long and/or repeated lockdown periods.

If companies have trouble filling positions, they might consider offering more flexibility. Another study by Gartner shows that, at least theoretically, employers and employees are aligned in seeing flexibility as critical to the organization. This includes as a top consideration the ability to work both from home and from the office, as well as somewhat flexible work times.

Yes, work-from-home will outlast COVID-19. At the same time, the concept of happynomics – the economics of personal happiness and well-being – is being transposed at work, with more corporate care for productivity through employee workplace satisfaction. It is by now quite clear that, the happier people are at work, the better the organizational outcomes.

***

Five challenges, each of them compounded by the prolonged uncertainty of COVID-19 and by looming political tensions in various hotspots around the world. Businesses large and small are already critically affected by all. No business will be spared from at least one of the 5 factors; many will be impacted by several or all.

In 2022, companies must be ready to pivot, change strategies, and adjust course mid-route. That doesn’t mean the first step shouldn’t be, always and most critically, planning for these 5 challenges. Dwight Eisenhower was right: Plans are worthless, but planning is everything.

 

 




The supply chain crisis: What it is, why it happened, what to do

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By Ilinca Anghelescu, EW Nutrition

“Supply chain issues” is now a buzzword that has gone beyond the realm of business into our lives and households. We know holiday gifts might be delayed because of supply chain issues, mobile phones or electric cars are facing essential parts shortages never before imagined, and entire companies’ production and delivery are affected by supply chain issues. Why is this happening and what can be done?

The supply chain crisis

Supply chains are nearly invisible – until something happens

The supply chain is an interdependent network of companies, individuals, databases, and actions whose ultimate goal is to ensure product or service delivery. The supply chain goes from the raw material to the end product or service that reaches the buyer. In most cases, this also includes the return of the goods or product servicing.

In the case of feed or food, for instance, a simplified version of the chain includes harvesting, storage, transportation, receiving and processing other raw materials, manufacturing, packaging, distribution, sale to the end customer, as well as potential returns at every stage along the way.

Supply chains are absolutely essential to the functioning of nearly everything in today’s society. If you eat tomatoes grown in your own garden, you are indeed outside the tomato supply chain; but your tools and fertilizer are probably not.

Supply chains are usually long, complex, highly interdependent, and often global because of cost pressure. No wonder, then, that one blow can bring down the whole domino chain. What is worse, the last year and a half brought not just one, but two concomitant blows.

Blow no. 1: Diminished capacity

The world is still reeling from the effects of COVID-19 – not just in terms of healthcare, but in terms of economic impact as well. In the immediate months after COVID-19 became a global concern, several things happened simultaneously to constrict the supply chain:

  • many factories limited the number of workers allowed on premises
  • ports (especially in China) shut down temporarily to halt the progress of the virus
  • face-to-face businesses shut down as a reaction to COVID-19 regulations

These and other similar measures put pressure on the global supply chain. Employee layoffs or furloughs, together with output decreases, meant fewer people could operate within the supply chain, which then translated into diminished production and delivery capacity.

To cope with the immediate state of things and with the predicted economic downturn, lots of companies (among those who did not shut down altogether) decided to reduce their output in order to save costs.

Blow no. 2: Increased demand

Despite the decreased demand for restaurant or hotel deliveries, lockdowns around the world brought about one other change: demand for endpoint deliveries soared. This would normally spell great news for producers, if only the supply chain weren’t in the way.

Supply chains are built to be as efficient as possible: fast, agile, and as economical as can be. In other words, “lean”. That also means that massive disruptions – whether positive or negative – are not easily handled. When demand for home deliveries went up dramatically, that would have been a good opportunity to beef up the delivery chain. Unfortunately, that increase in demand coincided with a limited personnel and product availability (because of blow no. 1), as well as shipping issues around the world.

How so? From the beginning of the pandemic until now, ships have been queuing up in ports around the world. The first Corona aftershock relocated production around the world and created unexpected demand. Containers were filled with high-margin goods (such as facial masks or home electronics) for the richer countries, while low-margin goods for other areas had to wait for free space.

Big Ship

This short-term unexpected move created competition for the limited number of containers on the market. Prices soared and containers traded at five times the cost of the previous year. (The Ever Given crisis in mid-2021 did not help, of course.) At the same time, unloading the cargo at the destination point had to be managed with reduced personnel, as pandemic restrictions still applied and docking availability remained the same. Ships had to wait for days to unload their cargo, despite high demand for their empty containers.

Collateral victim: semiconductors

It turns out, not surprisingly, that we have all grown more addicted to technology during the pandemic. Increased demand in home electronics, coupled with issues in the production of silicone-based parts (mostly led by a drive to reduce power consumption in China), led to a worldwide chip shortage that is affecting companies across many industries. Most notably, Tesla, Apple or Qualcomm are struggling to deliver orders and are readjusting their launch and delivery plans. If your mobile phone is delivered weeks late, blame it on the supply chain.

How to handle the supply-chain crisis

In 2022, keep your expectations low. The issues will not be resolved in a couple of months, so you must prepare for a year of very slow progress.

Prepare for at least two more years of high costs. Delivery delays will hit some markets more dramatically. Chip manufacturers have already announced shortage expectations throughout 2023, with lead times growing from 9 to 20+ weeks. Many large players in tech have announced plans to build their own plants or replace chips (as Tesla did) with different technologies. Do not be overly optimistic, though: such plans take a long time – and ports are reeling from a new wave of COVID-19 infections and restrictions. At this point, it is not just the shipping costs that are running a little wild, with no incentive for the cargo players to lower them; it is also the ports themselves. In the port of Los Angeles, as in many around the world, it is not unusual for cargo to wait a month out at sea to be given access to docking and unloading.

Order early. This seems like a commonsensical step – and it is, at this point. As mentioned above – do not expect things to be resolved quickly and painlessly. Protein markets are hit just as much as tech components; ship and truck deliveries will take a very long time to recover across all sectors. Demand is increasing and supply is still low – and slow. Order early and strategize to cover the new cost structures.

Explore options around the world. With China and Western Europe getting hit by new variants and suboptimal vaccination levels, the rest of the world remains to be explored. Options in richer countries, that once seemed too expensive, now may have an edge. Look closer to home rather to what was formerly a more cost-effective source. With shipping costs 3x to 10x what they were two years ago, the incentive is gone. (Even so, air freight is prohibitively expensive, so land access may be the most realistic option where accessible.)

Expand your capacity. Not everyone can start building plants at the drop of a hat, like Apple; but many companies can consider adding production lines or partnering with allies (and even competitors) to build or exploit resources. Since the supply chain issues are expected to last a couple more years on the optimistic side, it’s a good idea to explore your options not just in geography, but in partnerships for capacity as well.

Prepare for worse times before the good ones. It’s always a good idea to be prepared, but even more so now. Some ports are already closing again in early December (for instance, Dalian, China, took early measures against an outbreak) and the world is reacting to another potential large-scale lockdown.
On top of that, recession seems inevitable in many industries, and the new Corona mutations have already pushed the stock market down a few notches. Inflation has increased – 6.2% in the US in October versus last year, and in the eurozone the 4.1% inflation is the highest in the past 13 years. Some industries fare well simply because the market need is there (food and feed among them), but remember that the supply chain has companies across industries fighting for the same cargo space.

The answer to the supply chain challenge is to practice caution, spread risk, and actively seek out opportunities – including partnerships, new business, and unexpected collaborations. But then, these are good business practices at all times.




The fourth agricultural revolution is coming. Are you coming along?

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By Ilinca Anghelescu, EW Nutrition

Momentous changes are happening in our lives and our industry. A lot of them are caused by globalization – COVID-19 or the effects of supply chain disruptions, among the more recent ones. Many more, though, that impact our personal and professional lives, are caused by digital advances omnipresent in contemporary society. And, although some view agribusinesses as a conservative industry, that has long not been the case. Mature companies have their eyes on the fourth agricultural revolution – and digitalization is a large part of it.

What is an agricultural revolution, anyway?

Agriculture has long been a motor of progress in human lives. Each agricultural revolution has brought about enormous improvements in living standards and consequently in life expectancy.

 fourth agricultural revolution

The first agricultural revolution took place about 10,000 ago, when hunter/gatherer communities began to settle and grow crops for sustenance. The revolution largely consisted of the domestication of plants and animals, as well as with agricultural processes. This revolution, it is widely believed, altered the course of human history and even biology: humans were able to form settlements and have predictable and nourishing food sources. Through that we also developed caries, body fat, and deficiencies in fiber and micronutrients.

The second agricultural revolution happened much later, from the mid-17th to the late 19th century, starting in the British Isles. The revolution consisted largely of enormous production improvements, not just from increased human labor but also from innovations such as advanced ploughing techniques, crop rotation, plus selective animal breeding, improved transportation, and land drainage. These developments helped the empire sustain a demographic, as well and geographic expansion.

The third agricultural revolution, in the 1950s and ‘60s, was prompted by enormous strides made in chemical fertilizers, irrigation, mechanization, and the development of new, high-yielding crops. These advances made possible a yield increase of over 40% in the course of less than 50 years. The changes were even more dramatic in developing nations, where the standard of life saw huge improvements with the advent of high-yield rice, wheat, and corn.

Naturally, poverty is still a major concern. However, if poverty has declined by 85% between the 1860s and 2020, we largely have agriculture to thank for.

The fourth revolution is already happening (somewhat)

The fourth agricultural revolution has been touted for years now. Part of the wider 4IR (Fourth Industrial Revolution), it is widely seen as the next dramatic improvement in the quality and quantity of agricultural and livestock output. The fourth agricultural revolution (alternatively, Agriculture 4.0) has been prompted, just like 4IR, first and foremost by digital advances. It relies, among many other innovations, on automation, gene editing, nutrigenics, traceability, and precision livestock farming.

In many cases, these advances are not yet fully developed, not fully embraced, or not yet fully integrated into one standardized system. However, the trend is unmistakable and unstoppable: the fourth agricultural revolution has started.

EW Nutrition is starting a series of articles on the challenges of digitalization and digital transformation in the livestock production industry and in industry in general. These advances in the way crops and livestock are being developed, grown, processed, and delivered from the farm to the end consumer’s home are indeed radical.

More important, however, is to prepare the ground for what’s coming. If organizations are not digitally savvy and technologically advanced, how will they deal with the abundance of data that Agriculture 4.0 relies on?

Digitization –> Digitalization –> Digital Transformation

There is a lot of confusion about the three terms, especially because digitization and digitalization are often used interchangeably. However, in terms of business strategy there are clear differences which could be clarified if we visualize the three terms as a funnel.

Digital Transformation

Digitization is the top level which most companies can easily reach. It refers to transferring a physical object to a digital representation. Think of it in terms of converting a 19th century novel to an e-book or turning a company ledger into an Excel spreadsheet.

Digitalization is the middle level of the funnel; fewer companies easily accede here, although it is nowadays an essential part of most businesses. Digitalization means using digital technologies to improve business processes and work more efficiently. Examples would be cloud storage for company files, virtual platforms for team conversations and project tracking, etc.

Digital transformation is transforming a business by using digital technologies, platforms, and processes to enable change, optimize the business model, and deliver better results for the organization. Examples would be an e-commerce company that leverages information from machine learning and combines it with big data across its vertical to collect prospect information, pool data into a SSoT (single source of truth), and conduct analytics that inform predictive algorithms.

Sure, not all companies can – or should – move completely into the bottom layer of the funnel. Digital transformation can be partial and should only be leveraged in companies and industries where it makes sense.

Where exactly is your company along the funnel? Assessing your current status is essential to developing a strategy to meet Agriculture 4.0 head on. And meeting it head on we must; it is no longer an option, but a necessity for organizations and businesses to remain relevant in tomorrow’s world.

 

Why are digitally mature companies better?

Regardless of the vertical in which you are operating, in 2022 your organization should be able to check most of the boxes suggested by Deloitte in the table above.

At the most superficial level, digital maturity is a good predictor of improved financial performance. The more digitally savvy companies are cashing in on their maturity.

Behind this predictive factor, however, is the reason why. Digitally mature companies

  • can better leverage the richness of data in their industry and ancillary verticals
    • better analytics-led decision-making
    • better positioning through market data
    • better product development through predictive analysis
  • can better hold together distributed businesses
    • provide tools, platforms, and processes that bring together distributed employees
    • collect information from multiple points into a SSoT (for instance, distributed ledgers or even less advanced, real-time tools)
  • can inspire more confidence in current and future employees
    • provide a sense of oneness and belonging through common tools and platforms
      inspire confidence through responsiveness and clear and transparent processes

 

Why are digitally mature companies better

How do companies begin on the road to digitalization?

The road to digitalization begins, first and foremost, with the will to change. Digitalization is change – and change is not easy, especially in more conservative industries or companies. Once the management understands the benefits of undertaking this process (which benefits are confirmed in multiple studies), there are several roads to choose from. However, to enable the process of digitalization in general, McKinsey identifies five key factors:

  • having the right, digital-savvy leaders in place
  • building capabilities for the workforce of the future
  • empowering people to work in new ways
  • giving day-to-day tools a digital upgrade
  • communicating frequently via traditional and digital methods

Once the organization has undergone the basics of change, the company can then strategize on how to take advantage of the trends in its specific market. In the animal production industry, these trends – briefly mentioned at the beginning – amount to a revolution.

The revolution is already underway. For the moment, however, it is developing on so many disparate fronts that there is no formal coherence and very little oversight. Because of that, but most especially because of digital immaturity, very few companies or institutions are prepared to deal with what is coming. Now is the time to get in shape and get the process started.

A peek at what’s coming

As we grew over the past few years, both organically and through M&As, we faced a few challenges that many will be familiar with:

  • a global team of 30+ nationalities that had to rally around one mission
  • over 400 diverse, vocal, highly individual employees
  • divergent value chains depending on country, region, and offered solution
  • a large work-from-home or distributed team in various locations, closely working with on-site colleagues
  • 10+ time zones
  • a sometimes dizzyingly fast pace of change

We were fortunately prepared to deal with most of the challenges. Even so, we were not 100% prepared. We have learned enormously in the course of these years and are now a few steps ahead.

Over the next couple of months, EW Nutrition is going to look at some of the most important topics around digitalization in general, digitalization in livestock and feed production, and obstacles to building a digitally mature company:

  • Digitalization-enabled change in distributed companies
  • The digitalization of animal farming
  • Digitalization in the workspace: Hurdles and benefits
  • …and more.

The process is never complete, of course. We just hope that, by learning in public and sharing our discoveries, we make our journey clearer – and perhaps other companies’ journey easier.

 


References

FAO. The role of digital technologies in livestock traceability and trade, 2020

Gartner. Manufacturing Industry Scenarios in 2023: Leading Through Innovation, published September 2018, updated February 2020.

Gartner, Top Strategic Technology Trends for 2021, 2020

Gurumurthy, Ragu and David Schatsky, Pivoting to digital maturity: Seven capabilities central to digital transformation, Deloitte Insights, March 13, 2019

Gurumurthy, Ragu et al., Uncovering the connection between digital maturity and financial performance, Deloitte Insights, May 2020, 2020

Kane, Gerald C., “Accelerating digital innovation inside and out: Agile teams, ecosystems, and ethics,” MIT Sloan Management Review and Deloitte Digital, June 4, 2019

McKinsey. Unlocking success in digital transformations, October 2018

Moatsos, Michail. Global extreme poverty: Present and past since 1820. In How Was Life? Volume II : New Perspectives on Well-being and Global Inequality since 1820, OECD 2021

Sharma, Deepak et al., Customer-centric digital transformation: Making customer success integral to the new organization, Deloitte Insights, September 5, 2019

Schwab, Klaus, The Fourth Industrial Revolution: what it means, how to respond, World Economic Forum, 14 Jan 2016

World Economic Forum, Innovation with a Purpose: The role of technology innovation in accelerating food systems transformation, January 2018

World Economic Forum, Technology Futures: Projecting the Possible, Navigating What’s Next. Insight Report, April 2021




How animal nutrition can contribute to sustainability

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By Dr. Inge Heinzl, Editor, EW Nutrition

 

Nowadays, the whole world is talking about sustainability. Many efforts aim to maintain our world for future generations, creating a balance between our current needs and those of our children, grandchildren, and great-grandchildren. The right animal nutrition choices play a crucial role in achieving the challenging aim of sustainable animal production.

SWINE PIGS PIGLETS SUSTAINABLE AMR
Animal nutrition solutions can support producers’ sustainability contributions, from animal welfare to antibiotic reduction

Sustainability – an old concept now set out in writing

The idea of sustainability is not new. Already the first humans lived sustainably, taking only as much as they needed and the environment could cope with, using all parts of the animals they killed. The German Hannss Carl von Carlowitz (1645-1714) coined the term sustainability in his oeuvre “Sylvicultura oeconomica” to counter a threatening raw material crisis. Wood was one of the most important raw materials. Besides heating, it was used for shipbuilding and mining. This was the reason that extensive areas in Europe were deforested and became deserted. Observing the impending disaster, von Carlowitz ” (1713) stated that only as many trees should be felled as can grow back through planned reforestation, sowing, and planting.

The Brundtland Report (1987), a document created by the World Commission on Environment and Development, is reckoned to be the starting signal for worldwide discussions about sustainability. In 2015, the result of a meeting of 193 members of the United Nations was the Agenda 2030 with 17 sustainable development goals for a “world we want” that should be achieved by 2030.

Sustainable Development Goals (SDG) of the Agenda 2030, fixed by the UN in 2015

How can the feed sector contribute to sustainability?

The animal nutrition industry’s sustainability efforts play into different SDGs, notably no. 2, zero hunger, no. 3, good health and well-being, no. 12, responsible consumption and production, no. 13, climate action, no. 14, life below water, and no. 15, life on land. In addition to the overarching goal of fostering higher animal welfare (cf. Keeling et al., 2019), the feed sector’s measures center on three areas:

  1. Optimal use of feed resources, which includes optimizing feed conversion, preserving feed quality, and using alternative ingredients
  2. Preserving the environment by reducing ammonia and methane emissions and energy requirements
  3. Reducing antibiotics usage to maintain their efficacy for future generations

1.   Make best use of available resources

One of the 17 points on the list of the United Nations is “responsible consumption and production”.  For the feed industry, this means making the most out of available feed sources. Improvements in feed conversion, the maintenance of feed quality, and the use of alternative ingredients are all part of this.

Optimize FCR to utilize the available feed best

The feed conversion rate shows the amount of feed consumed in relation to the outputs produced, such as weight gain, eggs, or milk. The better or lower the feed conversion rate (FCR), the less feed you need to achieve your target, and the higher the yield. Products that improve feed conversion, therefore, can help to save resources.

Good feed conversion or an optimal utilization of nutrients depends on gut health. Only a healthy gut can digest the feed and absorb the nutrients adequately. Hence, products to improve feed conversion often do so by improving gut health.

Phytomolecules: proven to improve feed conversion

Herbs and their active components have been used in human and veterinary medicine for thousands of years to treat digestive tract diseases. Nowadays, products based on phy­tomolecules help improve feed conversion through their digestive, anti-inflammatory, and antimicrobial effects on the intestinal tract.

How do these three characteristics contribute to a better FCR?

  • Phy­tomolecules stimulate the secretion of digestive juices and the motility of the gut
  • Their antimicrobial effect supports a “healthy” balance in the microbiome, preventing damages of the gut wall by harmful microbes and, therefore, maintaining an optimal nutrient absorption
  • Their anti-inflammatory properties also contribute to good nutrient absorption and reduce endogenous nutrient loss

FCR improvements in broilers thanks to ACTIVO found in several studies

As phy­tomolecules are often volatile, EW Nutrition offers encapsulated phytomolecule-based products for the feed (ACTIVO product line). During episodes of elevated enteric challenge, e.g., weaning or following feed change, a liquid solution (ACTIVO LIQUID) can be applied via the waterline.

Enzymes help to make nutrients available

Some feed materials are hard to digest for certain animals. For example, pigs’ digestive systems do not have the enzymes required to break down non-starch polysaccharides (NSPs), such as cellulose, hemicellulose (ß-glucans and xylans), pectins or oligosaccharides. However, pig feed ingredients usually contain these substances.

Besides the non-usability of NSPs, the cage effect is a further problem. Cellulose and hemicellulose, water-insoluble NSPs, encage nutrients such as proteins or digestible carbohydrates. Encaged nutrients cannot be reached by the digestive enzymes and don’t become available to the animal.

Xylanases are available on the market to degrade structural substances in the feed and make them, as well as the nutrients they encaged, available for the organism.

Maintain the quality of your feed materials

Another possibility to save resources is the maintenance of feed quality. Bad weather conditions at harvest or incorrect storage can downgrade feed quality due to the development of molds and their mycotoxins or the oxidation of nutrients. Products mitigating the adverse effects of toxins, acidifiers that reduce microbial load, and antioxidants can help to keep your feed quality on a high level – or to re-establish it.

Mitigate the adverse effects of mycotoxins

Feed materials contaminated with mycotoxins harm animals in different manners and should not be used without further treatment. Mycotoxins are not visible – even if no molds are visible, mycotoxins might be present. Additionally, they are pH- and thermo-stable, meaning that mycotoxins produced in the raw materials on the field remain in the finished feed. As mycotoxins often do not cause apparent, specific symptoms but manifest in decreased performance, feed refusal or lower feed intake, and higher disease susceptibility, it is difficult to notice contamination.

Products such as SOLIS or MASTERSORB contain clay minerals (bentonite and montmorillonite) that adsorb the toxins. MASTERSORB GOLD and MASTERSORB FM also include toxin-adsorbing yeast cell walls and herbal substances to help protect the liver.

Feed spoilage through molds, yeasts, and mycotoxins wastes precious resources

Reduce microbes in the feed with acidifiers

Acidifiers based on organic acids counter harmful microbes in the feed in two ways. Most pathogenic bacteria are susceptible to low pH. The proliferation of, e.g., E. coli, Salmonella, and Clostridium perfringens is minimized at pH < 5 (cf. Fuller 1977). Acidic-tolerant beneficial bacteria such as Lactobacilli or Bifidobacterium, however, survive.

Other than antimicrobial activity, organic acids also cause a significant reduction in ammonia (Eriksen et al., 2014). This finding could be due to a reduction in the microbial deamination of amino acids, which would then be available for absorption, resulting in increased nitrogen digestibility and reduced ammonia excretion, as observed in monogastrics fed organic acids (Pearlin et al., 2020).

The acidifier product lines ACIDOMIX, FORMYCINE, and PRO-STABIL all help protect feed from contamination with pathogenic microorganisms.

Protect the feed’s nutrients from oxidation

The oxidation of nutrients in the feed decreases its nutritional value and, thereby, the value of the whole diet. Fat, proteins, fat-soluble vitamins, pigments, and other biologically active molecules, including sugars and phospholipids, can get oxidized. Metal ions and other pro-oxidative factors can affect the ingredients of the feed during mixing, storage, and feeding. The oxidation of fats and fat-soluble vitamins results in color changes or odors and – this is even more serious – in the production of harmful substances such as aldehydes and ketones. An oxidized feed can lead to oxidative stress in the animals, reduce their immunity, productivity, and livability.

To protect valuable ingredients, the timely addition of effective antioxidants such as STABILON is recommended.

Use alternatives to natural protein sources

Soybeans are an excellent source of protein in animal nutrition. During the last 50 years, soy production has increased from 27 million tons to 269 million tons, causing environmental degradation of forests and savannas (WWF, 2021). The use of alternative protein sources helps protect our environment.

Ruminants partly cover their protein requirements with the help of rumen bacteria. These bacteria can turn nitrogen from urea into bacterial protein, provided they receive enough energy available from carbohydrates. Thanks to its encapsulation, PROTE-N, a feed-grade urea-based nitrogen source, slowly releases nitrogen into the rumen, synchronized with the energy supply. PROTE-N affords producers a degree of independence from soybean protein without compromising nutritional quality.

Reducing soybeans in ruminant feeds helps to lower their environmental impact

2.   Preserve the environment

Animal production generates gases such as ammonia and methane that negatively impact the environment. Measures to reduce these gases help to protect plants, animals, us, and our globe.

Reduce ammonia by improving protein digestion

Besides nitrogen oxides, ammonia is one of the primary sources of nitrogen pollution. Ammonia damages ecological systems through acidification and nutritional oversupply. Fast-growing plants that need high amounts of nitrogen or plants that tolerate low soil pH proliferate, whereas more susceptible plants disappear, decreasing biodiversity. According to Max-Planck-Gesellschaft (2017), reducing ammonia emissions by 50 % could prevent 250.000 deaths caused by fine dust worldwide per year.

Improved protein digestion in animals reduces their ammonia production. Decreasing the intestinal pH through using organic acid-based products such as ACIDOMIX or FORMYCINE is essential for the activation and correct functioning of the enzymes responsible for protein digestion.

Reduce methane, the second most abundant greenhouse gas

Together with CO2, N2O, and three fluorinated gases, methane belongs to the greenhouse gases listed in the Kyoto protocol. Being over 25 times more potent than carbon dioxide at trapping heat in the atmosphere, it dramatically affects the earth’s temperature and the climate system (United States Environmental Protection Agency). Methane is a final product of feed fermentation in the rumen and is produced by methanogenic bacteria. Ruminants can produce 250-500 L methane per day (Johnson & Johnson, 1995).

Reducing methane production in ruminants is a critical step towards climate protection. Herbal substances can change the microbiome, leading to improved protein and fiber degradation and reduced methane production (Ku-Vera et al., 2020). ACTIVO PREMIUM is a phy­tomolecules-based product for ruminants that helps reduce their methane emissions.

Energy savings

To preserve the environment, reducing energy needs is also an important topic. Using the surfactant SURF-ACE in the pelletizing process, feed mills can cut 10-15 % of their energy consumption or produce up to 10-15 % higher pellet output without increasing their energy consumption. When moisture is added together with the surfactant, the emulsion of the dietary fat and the added water leads to better general lubrication of the machinery and improved press throughput.

FEED MILL POULTRY FEEDFeed mill efficiency is key to animal nutrition’s carbon footprint

3.   Reduce antibiotic use in animal production to keep this tool effective

Point 3 on the UN’s Agenda 2030 is good health and well-being. For many years, antibiotics, a very effective weapon, have been used to fight bacterial diseases. However, the occurrence of resistance is increasing. One of the reasons is the inappropriate use of antibiotics. These substances are often used preventively or for viral diseases against which they are ineffective. Also, the use of antibiotics as growth promoters at low dosages in animal production strongly contributed to the development of antimicrobial resistance.

Limiting antibiotic use to therapeutic treatment is possible through good farm management and feed supplements that support animals’ gut health, immune systems, and respiratory health. For this purpose, solutions ranging from phy­tomolecules (ACTIVO products, GRIPPOZON) to egg immunoglobulins (GLOBIGEN products, PROTEGG), products mitigating the impact of toxins (MASTERSORB products, SOLIS), beta-glucans/MOS (BGMOS), and acidifiers (ACIDOMIX, FORMYCINE) are available.

The feed sector has the tools to achieve more sustainability!

The animal nutrition industry provides many products to support animal producers in coping with their main challenges, including the shift to more sustainable production practices. Solutions exist to save feed resources, better protect the environment, and keep antibiotic tools effective. As an additional reward, implementing sustainability solutions leads to healthy animals with high performance. Let’s all help to preserve this planet for our next generations!

References

Eriksen, J., Nørgaard, J. V., Poulsen, H. D., Poulsen, H. V., Jensen, B. B., & Petersen, S. O. (2014). Effects of Acidifying Pig diets on emissions of AMMONIA, methane, and sulfur FROM Slurry during storage. Journal of Environmental Quality, 43(6), 2086–2095. https://doi.org/10.2134/jeq2014.03.0108

Fuller, R. (1977). The importance of lactobacilli in maintaining normal microbial balance in the crop. British Poultry Science, 18(1), 85–94. https://doi.org/10.1080/00071667708416332

Johnson, K. A., & Johnson, D. E. (1995). Methane emissions from cattle. Journal of Animal Science, 73(8), 2483–2492. https://doi.org/10.2527/1995.7382483x

Keeling, Linda, Håkan Tunón, Gabriela Olmos Antillón, Charlotte Berg, Mike Jones, Leopoldo Stuardo, Janice Swanson, Anna Wallenbeck, Christoph Winckler, and Harry Blokhuis. “Animal Welfare and the United Nations Sustainable Development Goals.” Frontiers in Veterinary Science 6 (October 10, 2019). https://doi.org/10.3389/fvets.2019.00336.

Ku-Vera, J. C., Jiménez-Ocampo, R., Valencia-Salazar, S. S., Montoya-Flores, M. D., Molina-Botero, I. C., Arango, J., Gómez-Bravo, C. A., Aguilar-Pérez, C. F., & Solorio-Sánchez, F. J. (2020). Role of secondary plant metabolites on enteric methane mitigation in ruminants. Frontiers in Veterinary Science, 7. https://doi.org/10.3389/fvets.2020.00584

Max-Planck-Gesellschaft. (2017, October 27). Reducing manure and fertilizers decreases atmospheric fine particles. Max-Planck-Gesellschaft. https://www.mpg.de/11667398/agricultural-emissions-fine-particulate-matter.

Pearlin, B. V., Muthuvel, S., Govidasamy, P., Villavan, M., Alagawany, M., Ragab Farag, M., Dhama, K., & Gopi, M. (2020). Role of acidifiers in livestock nutrition and health: A review. Journal of Animal Physiology and Animal Nutrition, 104(2), 558–569. https://doi.org/10.1111/jpn.13282

United Nations. (n.d.). How your company can advance each of THE SDGS: UN Global Compact. How Your Company Can Advance Each of the SDGs | UN Global Compact. https://www.unglobalcompact.org/sdgs/17-global-goals.

United States Environmental Protection Agency. (n.d.). Importance of methane. EPA. https://www.epa.gov/gmi/importance-methane.

von Carlowitz, H. C. (1713). Sylvicvltvra oeconomica, oder, Hausswirthliche Nachricht und Naturmässige Anweisung zur Wilden BAŬM-ZŬCHT: Nebst gründlicher darstellung, wie Zu FÖRDERST durch Göttliches Benedeyen Dem allenthalben und insgemein einreissenden Grossen Holtz-mangel: Vermittelst Säe-pflantz- und Versetzung Vielerhand Bäume zu prospiciren …: Worbey zugleich eine Gründliche nachricht von den in Churfl. Sächss. Landen gefundenen Turff Dessen Naturliche beschaffenheit, Grossen NÜTZEN, Gebrauch und nutzlichen verkohlung, Aus Liebe Zu BEFÖRDERUNG des Algemeinen Bestens beschrieben. Verlegts Johann Friedrich Braun.

World Wildlife Fund. (2021). Soja – die Nachfrage steigt. WWF Startseite. https://www.wwf.de/themen-projekte/landwirtschaft/produkte-aus-der-landwirtschaft/soja/.




Antibiotics: Keep this effective weapon sharp

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By Technical Team, EW Nutrition

Antibiotics are a precious resource whose long-term efficacy must be protected – for human and animal health. This is a difficult challenge for healthcare providers (veterinarians and medical doctors), as well as farmers and integrators. In this series of articles, we will explore the general and specific measures and solutions through which animal production can contribute to the overall reduction of antibiotic use.

Responsible animal production contributes to maintaining antibiotic efficacy

Shortly after the discovery of penicillin in 1929, Alexander Fleming already pointed out the possibility of resistance during an interview with the New York Times. The first case of penicillin resistance was reported only one year after clinical trials began; within 20 years, 80% of Staphylococcus aureus isolates were resistant to penicillin (Lobanovska and Pilla, 2017).

Over the years, clients and patients have gotten used to receiving a pill to quickly fix their ailments. Often, antibiotics have been prescribed for illnesses they were not effective against, including viral challenges. This has unnecessarily accelerated the rate of resistance development. To reverse this trend, education is key. At the same time, the judicious use of antibiotics, meaning the correct antibiotic for the challenge plus proper administration and duration of use, is paramount for all medical professionals to help preserve the efficacy of these critical substances.

Antibiotic use in animal production must be reduced

For many years, animal producers have used antibiotics as growth promoters. The E.U. banned this type of use in 2006, and the United States followed in 2017. Evaluations have shown a decrease in antibiotic use in the U.S.: In 2014, according to the FDA, 17,000 tons of antibiotics were sold in the United States for livestock, representing 80 percent of all U.S. antibiotics sales. In 2019, a total of about 11,000 tons of antibiotics were sold for use in food-producing animals (FDA, 2020).

As the number of isolated multi-drug resistant bacteria increases and the discovery and approval of new antibiotics slows, it is imperative that the use of antibiotics in animal production, especially those that are critically important for humans, is reduced to a minimum. Hence, antibiotics should only be used to treat, control, or prevent diseases in case of imminent risk, but not for growth-promoting purposes.

Scanning electron micrograph of methicillin-resistant Staphylococcus aureus bacteria (yellow) and a dead human white blood cell (red). Credit: National Institute of Allergy and Infectious Diseases/NIH

Customers’ requests for antibiotic-free chicken push antibiotic reduction

Many birds are already raised without antibiotics in the US and elsewhere because of the demands of the market. Since 2016, chicken antibiotic sales decreased by 62% (Dall, 2020). Frequently, the goal of these antibiotic-free (ABF) production programs is to differentiate products in a highly competitive commodity market. The reduction of antibiotic use has been a secondary, generally unintended consequence.

Nevertheless, to meet customer demands for ABF products, antibiotics that are not important to human health but for production (e.g., ionophores) have also been eliminated. In many cases, this has negatively affected growth performance and bird health. As the requirements for production efficiency and welfare standards increase, transitioning from “conventional” to ABF production poses a challenge for everyone involved.

Antibiotic reduction through improved management

One must never trade animal welfare for reduced antibiotics use, but the need for them can be decreased through improved management practices. Flock health starts with genetics companies selecting birds that are resilient to disease and management challenges and continues all the way to the processing plant. All of the inputs and practices must be optimized in modern poultry production to maintain a high level of performance and animal welfare while reducing reliance on antibiotics.

Antibiotic-free requires diligent management

When antibiotics are not available, attention to detail becomes more decisive. All aspects of production are important, but the most critical stages are those that affect the downstream process. The pullets, breeders, and hatchery require the most meticulous care. Additionally, all production factors must meet the highest quality standards: feed, light, air quality, water quality, litter quality, biosecurity, vaccination, sanitation, nutrition and feeding.

Antibiotic reduction requires meticulous attention to detail to safeguard animal welfare.

Non-antibiotic feed additives support ABF programs

ABF production is all about sustainability. For agricultural operations to survive and thrive in the future, one has to move away from the old paradigm of “saving the way to success”. This is not impossible in ABF production, but misses out on the larger picture of long-term profitability, investment in innovation, and system change.

Non-antibiotic feed and water additives are essential resources to support sustainable management. To mention a few, probiotics, prebiotics, toxin binders, organic acids, and phy­tomolecules are all options for reducing the need for antibiotics based on different modes of action. Phytomolecules, for example, often have antimicrobial properties, some toxin binders can bind bacterial toxins, and pre- and probiotics support the gut flora. There are many kinds of solutions on the market; the key is to find the right ones for your issues.

Antibiotic stewardship: together for a healthier future

There is already a large body of literature demonstrating the benefits of alternative or complementary solutions. More importantly, there are already many people that successfully raise birds and other animals without antibiotics. Whenever possible, leverage your professional network and talk to trusted people with unique experiences. Working together, we can build a healthier future for people and animals.

 

The Antibiotic Reduction series

The series that debuts here consists of a set of articles offering professionals a practical overview of poultry production with reduced antibiotic use. The independent expert in charge, starting with the next article in the series, is Dr. TJ Gaydos, who holds a Master’s degree in Avian Medicine and is a diplomate of the American College of Poultry Veterinarians.

Dr. Gaydos works with integrated poultry companies and allied industries, focusing on bird health and antibiotic-free production performance. He has spent his veterinary career working to improve intestinal health, animal welfare, production efficiency, and reduce zoonotic diseases. He works extensively with intestinal health, probiotics and prebiotics, and other non-antimicrobial feed additives.

Topics covered under Dr. Gaydos’s guidance include biosecurity, nutrition, pullet management, hatchery sanitation, gut health, and more. Together they provide an extensive look at the producers’ pain points and potential strategies to maintain bird health while mitigating the need for antibiotics.

References

AccessScience Editors, “U.S. Bans Antibiotics Use for Enhancing Growth in Livestock.” Access Science. McGraw-Hill Education, January 1, 1970. https://www.accessscience.com/content/u-s-bans-antibiotics-use-for-enhancing-growth-in-livestock/BR0125171.

Dall, Chris. “FDA Reports Another Rise in Antibiotic Sales for Livestock.” FDA Reports Another Rise in Antibiotic Sales for Livestock | International Biosecurity and Prevention Forum, December 16, 2020. https://www.ibpforum.org/news/fda-reports-another-rise-antibiotic-sales-livestock.

Lobanovska, Mariya, and Giulia Pilla . “Penicillin’s Discovery and Antibiotic Resistance: Lessons for the Future?” Yale Journal of Biology and Medicine. 90, no. 1 (March 29, 2017): 135–45.

U.S. Food and Drug Administration. “2020 Summary Report On Antimicrobials Sold or Distributed for Use in Food-Producing Animals” Food and Drug Administration, 2019. https://www.fda.gov/media/144427/download.




Norovirus outbreaks could be avoided with IgY technology

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By Technical Team, EW Nutrition

In July, Public Health England (PHE), an executive agency of the Department of Health and Social Care in the United Kingdom, reported a rise of norovirus outbreaks in the country. Norovirus, a highly contagious virus similar to the coronavirus, is the main cause of viral food poisoning from shellfish. Symptoms include vomiting, diarrhea, cramps, as well as muscle aches and headaches.

The PHE press release shows an increase in outbreaks during the last two months, returning to pre-pandemic levels. According to the organization, the number of outbreaks has nearly tripled when compared to the same time period in the last 5 years, affecting people of all age groups and settings in England. Closed places where the virus can spread quickly, especially childcare facilities and nursing homes, are the most affected, as shown below.

Enteric virus outbreaks reported in England during the 2020/2021 season. Source:  National Norovirus and Rotavirus Bulletin, Public Health England, 2021 National Norovirus and Rotavirus Bulletin (publishing.service.gov.uk)

Norovirus: A global problem

The issue is not restricted to England. According to the CDC (Centers for Disease Control and Prevention), about one out of every five cases of acute gastroenteritis that leads to diarrhea and vomiting is caused by norovirus, responsible for over 200,000 deaths and a global economic burden of more than $60 billion. The large costs come from healthcare costs and productivity losses and can be seen in low, middle, and high-income countries as shown below.

Global economic burden of norovirus gastroenteritis. Source: https://doi.org/10.1371/journal.pone.0151219.t003

Prevention is key

Noroviruses is easily transmitted through contact with infected individuals or contaminated surfaces. There are many ways to reduce the spread of the virus (e.g., washing the hand thoroughly with soap and water) but prevention is key.

The outbreaks often occur from contaminated oysters or other shellfish which are consumed raw, making foodborne transmission accountable for a considerable number of cases. The conventional cleaning and purifying methods currently used in the industry cannot reliably reduce the number of norovirus contained in its digestive organ, therefore it is of extreme necessity to look new solutions to improve safety in shellfish production. And this is exactly what EW Nutrition does.

Combatting the norovirus: the IgY solution

With our mission to mitigate the impact of antimicrobial resistance in mind, we developed a new technology to improve food safety in shellfish production. Our solution is based on a high value source of natural egg immunoglobulins (IgY), which will prevent the virus from infecting the oyster’s digestive organ.

This method consists in adding anti-norovirus IgY to the seawater during the depuration process, which is a postharvest treatment where the shellfish are placed in tanks of clean seawater to reduce contaminant levels and allow shellfish to cleanse or purge themselves by continuation of their normal filter-feeding and digestive processes.

Natural, effective, and safe

While depuration is a highly effective and very common commercial practice for removing different pathogens, several studies show that the depuration process alone is not enough to remove completely or lower the norovirus to a safe level. On the other hand, various trial results show that shellfish treated with EW Nutrition technology is completely free from or has very low amount of live norovirus, allowing a safe consumption of raw oysters and minimizing the risk of any other outbreaks.

For more information about our solution, you can reach out to Lucas Queiroz or to your local EW Nutrition contact.

 

References

Bartsch et al. 2016. Global Economic Burden of Norovirus Gastroenteritis. https://doi.org/10.1371/journal.pone.0151219

 Lee, R.; Lovatelli, A.; Ababouch, L. Bivalve depuration: fundamental and practical aspects. FAO Fisheries Technical Paper. No. 511. Rome, FAO. 2008. 139p.

National Norovirus and Rotavirus Bulletin, Public Health England, 2021 National Norovirus and Rotavirus Bulletin (publishing.service.gov.uk)

Norovirus outbreaks increasing in England – GOV.UK (www.gov.uk)

Norovirus Worldwide | CDC




The Quick Take: Mitigate spikes in Vitamin E costs

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Vitamin E prices have spiked amid production issues and lack of availability. How can you mitigate the increased cost of vitamin E inclusion?

Vitamin E prices often see severe fluctuations caused by raw materials shortages, production or distribution issues, or regulations on some key production ingredients (such as m-cresol anti-dumping rules in China leading to a global price spike some months ago).

SANTOQUIN acts as a preservative for Vitamin E, allowing more of this vitamin to enter the tissue where it exerts its antioxidant effect. In addition, in the presence of selenium, another important cellular antioxidant mineral, SANTOQUIN can help protect or spare the Vitamin E needed for proper cell function.

The Food and Agriculture Organization of the United Nations, FAO, clearly confirms this mode of action: “Dietary deficiencies of vitamins A and E seem to be ameliorated in certain circumstances and ethoxyquin promotes higher levels of vitamin A storage in the liver. Repletion/deletion experiments show that in both monogastric and ruminant animals, a diet containing an anti-oxidant protects fat soluble vitamins throughout ingestion and metabolism. The important benefit of antioxidants most probably lies in their conservation of essential nutrients and their improved utilization by the animal. Altogether too often, it is the practice to use levels of vitamin E far above the animals’ nutrient requirement and the result is economically unfavorable. It has been shown in diets designed for chicken and turkey breeders that ethoxyquin has a vitamin E sparing effect.”

 




Are endotoxins behind your low livestock productivity?

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by  Dr. Inge Heinzl, Editor, EW Nutrition

Impaired health status of the animals in stressful situations or an aggravation of the disease after antibiotic treatment? The culprit might be endotoxins.

What are endotoxins?

Origin

Endotoxins, together with exotoxins, are bacterial toxins. In contrast to exotoxins, which are actively secreted by living bacteria, endotoxins (name “endotoxin” greek; endo = inside; toxin = poison) are components of the outer cell membrane of gram-negative bacteria such as Escherichia coli, Salmonella, Shigella, and cyanobacteria (blue-green algae). They are only released in case of

  • bacterial death due to effective host defense mechanism or activities of certain antibiotics
  • bacterial growth (shedding) (Todar, 2008-2012)

 

 The location of endotoxins within the bacterial cell © Prof. Dr. med. Marina A. Freudenberg  

Structure

Biochemically, endotoxins are lipopolysaccharides (LPS). They are composed of a relatively uniform lipid fraction (Lipid A) and a species-specific polysaccharides chain. Their toxicity is mainly due to the lipid A; the polysaccharide part modifies their activity. Unlike the bacteria, their endotoxins are very heat stable and resist sterilization. The names endotoxin and lipopolysaccharides are used synonymously with “endotoxin” emphasizing on the occurrence and biological activity and “lipopolysaccharide” on the chemical structure (Hurley, 1995).

 

General structure of Gram-negative lipopolysaccharides (according to Erridge et al., 2002)

Impact

Endotoxins belong to the so-called pyrogen-agents (they provoke fever), activating several immunocompetent cells’ signaling pathways. Early contact with endotoxins leads to activation and maturation of the acquired immune system. Braun-Fahrländer and co-workers (2002) found that children exposed to endotoxins had fewer problems with hay fever, atopic asthma, and atopic sensitization. This might be an explanation that in human populations, after the elevation of the hygiene standards, an increase of allergies could be observed.

Different animal species show different sensibilities to endotoxin infusions, e.g. (healthy) dogs, rats, mice, hens tolerate concentrations ≥1mg / kg body weight, whereas (healthy) ruminants, pigs, horses react very sensible already at concentrations <5μg / kg body weight (Olson et al., 1995 cited in Wilken, 2003).

Reasons for increased exposure of the organism to endotoxins

Endotoxins usually occur in the gut, as the microflora also contains gram-negative bacteria. The precondition for endotoxins to be harmful is their presence in the bloodstream. In the bloodstream, low levels of endotoxins can still be handled by the immune defense, higher levels can get critical. An increase of endotoxins in the organism results from higher input and/or lower clearance or detoxification rate.

Higher input of endotoxins into the organism

The “normal” small amounts of endotoxins arising in the gut due to regular bacterial activity and translocated to the organism have no negative impact as long as the liver performs its clearance function. Also, the endotoxins stored in the adipose tissue are not problematic. However, some factors can lead to a release of the endotoxins or translocation of endotoxins into the organism:

1.      Stress

Stress situations such as parturition, surgeries, injuries can lead to ischemia in the intestinal tract and translocation of endotoxins into the organism (Krüger, 1997). Other stress situations in animal production, such as high temperatures and high stocking densities, contribute to higher endotoxin levels in the bloodstream. Stress leads to a higher metabolic demand for water, sodium, and energy-rich substances. For a higher availability of these substances, the intestinal barrier’s permeability is increased, possibly leading to a higher translocation of bacteria and their toxins into the bloodstream.

Examples:

  • Higher levels of endotoxins in pigs in an experimental study suffering from stress due to loading and transport, elevated temperatures (Seidler (1998) cited in Wilken (2003)).
  • Marathon runners (Brock-Utne et al., 1988) and racing horses (Baker et al., 1988) also showed higher endotoxin concentrations in the blood proportional to the running stress; thus, trained horses showed lower concentrations than untrained.

2.      Lipolysis for energy mobilization

If endotoxins, due to continuous stress, consistently get into the bloodstream, they can be stored in the adipose tissue. The SR-B1 (Scavenger receptor B1, a membrane receptor belonging to the group of pattern recognition receptors) binds to lipids and the lipopolysaccharides, probably promoting the incorporation of LPS in chylomicrons. Transferred from the chylomicrons to other lipoproteins, the LPS finally arrives in the adipose tissue (Hersoug et al., 2016). The mobilization of energy by lipolysis e.g., during the beginning of lactation, for example, leads to a re-input of endotoxins into the bloodstream.

3.      Damage of the gut barrier

In normal conditions, due to bacterial activity, endotoxins are present in the gut. Damage of the gut barrier allows translocation of these endotoxins (and bacteria)  into the bloodstream.

4.      Destruction of Gram-negative bacteria

Another “source” for endotoxins is the destruction of the bacteria. This can be done on the one hand by the organism’s immune system or by treatment with bactericidal substances targeting gram- bacteria (Kastner, 2002). To prevent an increased release of endotoxins, in the case of Gram-negative bacteria, a treatment with bacteriostatic substances only inhibiting the growth and not destroying the bacteria, or with bactericidal in combination with LPS-binding agents, would be a better alternative (Brandenburg, 2014).

5.      Proliferation of gram-negative bacteria

As gram-negative bacteria also release small amounts of endotoxins when they grow, everything promoting their proliferation also leads to an increase of endotoxins:

Imbalanced feeding

High yielder cows e.g., are fed diets rich in starch, fat, and protein. Increased feeding of fat leads to a higher concentration of endotoxins in the organism, as the same “transporter” (scavenger receptor class B type 1, SR-BI) can be used (Hersoug et al., 2016) for the absorption of fat as well as for the absorption of endotoxins.

In a study with humans as representors of the monogastric species, Deopurkar and co-workers gave three different drinks (glucose – 100% carbohydrate, orange juice – 92% carbohydrate, and cream – 100% fat) to healthy participants. Only the cream drink increased the level of lipopolysaccharides in the plasma.

Infectious diseases

Infectious diseases like mastitis, metritis, and other infections caused by gram-bacteria such as E. coli, Salmonella, etc. can be regarded as sources of endotoxin release.

Decreased detoxification or degradation

Main responsible organ: the liver

Task: detoxification and degradation of translocated endotoxin. The liver produces substances such as lipopolysaccharide binding proteins (LBP) which are necessary for binding and neutralizing lipopolysaccharide structures.

During the post-partum period, the organism is in a catabolic phase, and lipolysis is remarkably increased for energy generation due to milk production. Increased lipolysis leads, as mentioned before, to a release of endotoxins out of the adipose tissue but also fatty degeneration of the liver. A fatty degenerated liver cannot bring the same performance in endotoxin clearance than a normal liver (Andersen, 2003; Andersen et al., 1996; Harte et al., 2010; Wilken, 2003).  In a study conducted by Andersen and co-workers (1996), they couldn’t achieve complete clearance of endotoxins in cows with fatty livers. The occurrence of hepatic lipidoses increases after parturition (Reid and Roberts, 1993; Wilken, 2003).

Also, other diseases of the liver influence endotoxin clearance in the liver. Hanslin and co-workers (2019) found an impaired endotoxin elimination in pigs with pre-existing systemic inflammatory response syndrome.

Relation between lipid metabolism and endotoxin metabolism (according to Fürll, 2000, cited in Wilken, 2003)

Issues caused by endotoxins

Endotoxins, on the one hand, can positively stimulate the immune system when occurring in small amounts (Sampath, 2018). According to McAleer and Vella (2008), lipopolysaccharides are used as natural adjuvants to strengthen immune reaction in case of vaccination by influencing CD4 T cell responses. On the other hand, they are involved in the development of severe issues like MMA-Complex (Pig Progress) or a septic shock (Sampath, 2018).

MMA Complex in sows

MMA in sows is a multi-factorial disease appearing shortly after farrowing (12 hours to three days), which is caused by different factors (pathogens such as E. coli, Klebsiella spps., Staph. spps. and Mycoplasma spps., but also stress, diet). MMA is also known as puerperal syndrome, puerperal septicemia, milk fever, or toxemia. The last name suggests that one of the factors intervening in the disease is bacterial endotoxins. During the perinatal phase, massive catabolism of fat takes place to support lactation. The sows often suffer from obstipation leading to higher permeability of the intestinal wall, with bacteria, respectively endotoxins being transferred into the bloodstream. Another “source” of endotoxins can be the udder, as the prevalence of gram-negative bacteria in the mammary glands is remarkable (Morkoc et al., 1983).

The endotoxins can lead to an endocrine dysfunction: ↑ Cortisol, ↓ PGF2α, ↓Prolactin, ↓ Oxytocin. MMA stands for:

– Mastitis, a bacterial infection of the udder.

Mastitis can be provoked from two sides: on the one hand, endotoxemia leads to an elevation of cytokines (IL1, 6, TNFα). Lower Ca- and K-levels cause teat sphincter to be less functional, facilitating the entry of environmental pathogens into the udder and resulting in mastitis. On the other hand,  due to farrowing stress, Cortisol concentrations get higher. The resulting immunosuppression enables E. coli to proliferate in the udder.

– Metritis, an infection of the uterus with vulvar discharges:

It leads to reduced contractions and, therefore, to prolonged and/or complicated farrowing or dead piglets. Metritis can be promoted by stress causing a decrease in oxytocin and prostaglandin F2α secretion. Morkoc and co-workers (1983) didn’t find a relation between metritis and endotoxins.

– Agalactia, a reduction or total loss of milk production:

In many cases, agalactia is not detected until the nursing litter shows signs of hunger and/or weight loss. At worst, the mortality rate in piglets increases. Probably, milk deficiency is caused by lower levels of the hormones involved in lactation. Prolactin levels e.g., may be dramatically reduced by small volumes of endotoxin (Smith and Wagner, 1984). The levels of oxytocin are often half those in normal sows (Pig Progress, 2020).

Endotoxin shock

A septic shock can be the response to the release of a high amount of endotoxins.

In the case of an infection with gram-negative bacteria, the animals are treated with (often bactericidal) antibiotics. Also, the immune system is eliminating the bacteria. Due to bacterial death, endotoxins are massively released. When not bound, they activate the immune system including macrophages, monocytes, and endothelial cells. Consequently, high amounts of cellular mediators like TNFα, Interleukin 1 (IL-1), IL-6, and leukotrienes are released. High levels of pro-inflammatory cytokines activate the complement and coagulation cascade. In some animals, then the production of prostaglandins and leukotrienes is stimulated, implicating high fever, decreased blood pressure, generation of thrombi in the blood, collapse, damaging several organs, and lethal (endotoxic) shock.

Endotoxic shock only occurs to a few susceptible animals, although the whole herd may have been immune-stimulated. A more severe problem is the decrease in the normally strong piglets’ performance, deviating resources from production to the immune system because of the endotoxemia.

Amplified diarrhea

Lipopolysaccharides lead to an augmented release of prostaglandins, which influence gastrointestinal functions. Together with leukotrienes and pro-inflammatory mediators within the mucosa, they reduce intestinal absorption (Munck et al., 1988; Chiossone et al., 1990) but also initiate a pro-secretory state in the intestine. Liang and co-workers (2005) observed a dose-dependent accumulation of abundant fluid in the small intestine resulting in increased diarrheagenic activity and a decreased gastrointestinal motility in rats.

Conclusion

Acting against Gram- bacteria can result in an even more severe issue – endotoxemia. Endotoxins, besides having a direct negative impact on the organism, also contribute to some diseases. Supporting gut health by different approaches, including the binding of toxins, helps to keep animals healthy.

 

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