Bee Forty One Agrotech

Objective - Demonstrate Simple Feedlot System

Features of the system

No grass required - Palm Fronds or Padi Straw for roughage. Good quality and cost effective concentrate made from local ingredients. Deep litter bedding for low labour and compost accumulation.

We have implemented this system with excellent results. Cattle initially were very thin and not improving, with high mortality, and the feedlot smell was overpowering and disturbing to nearby residents. Within two weeks the cattle were eating well, already improved in condition, and the smell significantly reduced. Within 1 month many of the cattle were already suitable for sale. It was fortunate timing, because these cattle were available for Korban sales. The project suffered disturbance in the weeks preceding Hari Raya Korban, with too many cattle being accommodated for preparation, but we successfully fed them during this period and filled the orders with good quality cattle.

Reliable weighing was only achieved in the second half of the project (after Hari Raya), but an early estimate made by weighing a truckload of cattle, indicated weight gain of 2kg/day in the first month. The excellent condition of the animals sold for Korban validated this estimate. It is consistent with the later results, where weight gains fell into two categories - thin adult cows direct from the plantations put on 1.5-2.2kg/day, while young and healthy bulls grew at 0.8-1.2 kg/day. Thin and hungry animals can achieve rapid weight gain by filling their stomach and quickly improving body condition, while young and healthy animals grow consistently according to the diet and their genetic potential. Both of these growth patterns present excellent opportunities for a feedlotter with access to good quality, cost effective feed resources.

Ultimately, a feedlot aims to convert feed into meat. Feed Conversion Ratio (FCR, kg feed eaten per kg wt gain) was 6.04 overall (unadjusted data,42 head) or 4.59 on adjusted data (35 head). This is an excellent result, better than many Australian feedlots.

Economic Performance

Economic performance is determined by Feed Conversion Efficiency. The cost of the feed required to achieve one kg weight gain, is the major component of total production cost. In this pilot project, the cattle consumed 6.04 kg dry matter to achieve 1 kg weight gain. This diet, comprising palm fronds and concentrate, cost under RM5/kg gain.

While the cost of feed to achieve one kg weight gain is around RM5/day, the further costs of labour and finance costs on cattle and infrastructure also need to be included in total cost of production. We estimate labour cost to be RM0.50/kg gain (see below).

An important concept to explain here is dry matter feed cost. Concentrate at 83c/kg as fed, with dry matter content 88% (moisture content 12%), costs 94c/kgDM. Palm fronds at 5c/kg as fed, with dry matter content 33%, cost 15c/kgDM. After calculating the relative intakes of each ingredient, (OPF 16.4%, Concentrate 83.6% of diet DM), the diet cost is 81.04c/kgDM.

Labour requirements

Although we used three labour inputs during the pilot project, it is concluded that two full time employees can easily care for 100-120 head in the existing facility. This includes giving feed and water, weighing and moving cattle when required, and manure management within the pens when required. It doesn't include collecting palm fronds from the plantation, this is covered by the RM50/ton estimated cost of the ingredient. It doesn't include the task of removing manure from the pens, this is a job to be done once a week by a larger team of workers, and it is expected that the sale value of the manure will cover that labour input. Finally, it doesn't include the supervisory role of the feedlot/cattle manager.

If we estimate two labour units to cost RM50/day, looking after 100 cattle gaining one (1) kg/day, the labour cost equals RM 0.50/kg weight gain.

Further Feedlot Potential

A feedlot can be considered as an entirely "stand-alone" enterprise, or as an integral part of a larger cattle farming business, which includes both breeding and fattening, and also accounts for the economic value of weed control in plantations. In the first case we primarily consider the supply and demand for beef, and our capacity to produce it, and decide whether we want to engage in the feedlot business. Current demand for beef in Sarawak would probably not sustain a 1,000 head feedlot, but B41 Agrotech is currently investigating export opportunities to "grow the demand". In the second case, a feedlot serves as a valuable tool to help manage the breeding herds in the plantations, and add maximum value to the animals sold from these herds. A feedlot with capacity of 200-400 head is highly recommended for this purpose, and the existing Ladang 3 feedlot (Miri) can be easily upgraded to this capacity. See recommendations below.

Commercial potential for Oil Palm Fronds (OPF)

We have clearly proven that oil palm fronds (OPF) can be fed to cattle in fresh condition. There has previously been a concern that the hard midrib of the leaflets could injure the digestive tract of cattle, but we did not experience any such incidences. Therefore in any cattle feeding business, if roughage is in short supply, the farmer may feel confident to use oil palm fronds to substitute grass. Can this be turned into a commercial opportunity for the oil palm plantation - ie can palm fronds become a commodity which can be bought and sold ? We believe the answer is yes, but in order to be successful they must be dried and packaged in some way. Some companies propose to dry, grind, and pelletise the OPF for export, but this may be a very risky enterprise with high investment required. A more simple approach would be to dry and bale the OPF into a "hay" product, for which the local demand will grow as farmers learn of the feeding benefits. We describe this opportunity further in recommendations below.

Cattle Management in the Oil Palm Plantations

Progress has been made in recent years to develop grazing systems for cattle under oil palms. This has allowed SPAD and other plantation companies to include breeding herds in their production systems. However, some plantations are more successful than others, with calving rates varying from 15% - 65%. It is now an opportune time to improve the management of the cattle in the plantations, to maximise the reproductive output of the breeding herds, and increase the overall productivity of each plantation. B41 Agrotech intends to propose a new management project for the plantation cattle.

Recommendations

Our major recommendation arising from this pilot project is that SPAD should continue to develop their feedlot to a capacity of 200-400 head, and use it as the central point for the overall management of all the breeding herds on the surrounding plantations belonging to the company. B41 Agrotech Sdn Bhd should be engaged to direct the feedlot upgrading and take over the management of the breeding herds.

If SPAD wants to further expand its feedlot activity, market research is required to establish the level of demand for quality beef, both locally and in potential export markets. A preliminary development plan to move towards this aim is attached.

Continued feedlotting will require us to develop a routine and efficient system to collect oil palm fronds. This presents an opportunity to commercialise OPF into a saleable commodity. We will also need to develop a manure management system, which should make best use of the manure as a valuable resource. This will lead us into areas of biogas and biomass energy systems, which will be synergistic with the above aim of processing OPF into a saleable commodity.

Following are more specific recommendations for steps which can be taken towards achieving these broad aims.

Training for feedlot Supervisor

SPAD's Feedlot Supervisor should take a study tour to visit feedlots in Australia. Include small "farm feedlots" in Victoria (50-250 head), and large feedlots in Queensland (1,000-20,000 head). Small feedlots are more relevant to SPAD's operation, but he should see the large feedlots to understand the differences. During this trip he should take a short course on "low stress cattle handling", to help himself and his staff achieve easier cattle movements, especially during loading onto trucks. It will also him to design improved handling facilities.

We have clearly demonstrated that your feedlot can successfully fatten cattle. Now is the time to improve the facility for better work efficiency, and for the safety and welfare of both humans and animals. Investment in good yards for handling cattle need not be expensive. Using 2" water pipe and the oil mill engineering facilities, we can supervise its fabrication. The main cost will be water pipe and groundworks - equipment and labour are already there. Widening the alleyways at the back of the pens should be the first step, and a holding and drafting pen should be made next to the loading ramp. As soon as possible, the second shed should be repaired to relieve overcrowding, or to house cows and calves not for fattening. The area between the two feedlot sheds can be developed as large holding yards for managing new arrivals and feeding starter rations. Improving the feedlot facilities will benefit the cattle management on all the surrounding plantations.

Hay Drying

B41 Agrotech Sdn Bhd constantly strives to achieve efficiencies and develop new opportunities, by identifying synergy between related processes and their inputs and outputs. The oil palm produces a lot more biomass than just fruit bunches. We have already proven the fronds to be safe and valuable as a roughage cattle feed. The plantation also grows other useful feed plants including various grasses, the leguminous ground cover mucuna, and wild or cultivated tapioca. Unfortunately these resources mostly go to waste because of their seasonal availability and the limited capacity to use them at the time. In order to fully utilise them within the plantation ecosystem, and even better to utilise them outside the confines of SPAD plantations - ie as saleable commodities - they need to be dried and packaged for convenient storage and transport. They need a significant input of energy to reduce their water content. On the one hand we have great feed resources going to waste for lack of drying, and on the other hand we have a lot of energy going to waste in the palm oil mill. Let's put these resources together and capture their value by making a commercial product.

The problem of poor animal production in the very presence of wasted feed resources is found throughout Malaysia. Wouldn't it be great if the SPAD and B41 Agrotech team could be the first in Malaysia to solve the problem ! Malaysia's capacity for animal production will escalate dramatically.

SPAD has indicated that they are considering the potential for a palm frond pelletising factory (OPF pellets). Our proposal for a hay drying plant will be a first step in this direction, but without the million dollar price tag associated with it. In fact, we believe that the further step to a pelletising plant will be totally un-necessary, because the demand for baled hay in Malaysia will be greater than the export potential for OPF pellets. As a first step, we have invited Mr Singh, the Batu Niah Mill manager, to begin considering designs and costs of a general purpose biomass dryer in the mill.

Biogas, Woodgas & Charcoal

SPAD has indicated an interest in producing Biogas from feedlot manure. This is indeed an excellent idea, but is it any better than using the manure for compost or worm farming ? To answer this question we need further research, and to this end a trip to Indonesia (Pontianak and/or Surabaya) is required. We need to view the systems already operating there, especially to study the gas capture, storage and utilisation procedures and equipment.

However, once again seeking synergies, we may find an even better resource at our fingertips, again in the huge amount of biomass produced from the oil palm tree. The EFB, press fibre and kernel shells from the mills, the pruned fronds in the plantation, and bare leaf stalks from the feedlot, could all be converted to woodgas, producing enough energy to power a town the size of Batu Niah itself. If not fully gasified, they could be partly gasified, yielding another by-product in the form of charcoal. Partial gasification and charcoal production is a lower level technology, which can share the gas capture and storage systems of biogas production.

We have produced charcoal from palm leaf stalks to prove it can be easily done. Charcoal has a base value as a soil conditioner, returning carbon and minerals to the soil in a lower volume than the alternative mulch or compost. With marketing efforts, higher values for "activated" charcoal or charcoal briquettes could be achieved, and there may even be opportunity to sell "carbon credits" when charcoal is returned to the soil as a means of carbon sequestration.

Together, SPAD and B41 Agrotech could become Malaysia's leader in the practical application of Biomass Energy Technologies. This is very relevant now, after the recent Copenhagen Conference.