Navigating Challenges and Innovation within the Feed Industry

Written by: Madison Wyman   |   April 12, 2024

Trade, Shipping, International Trade, HR

The feed industry is confronted with many factors that directly influence our global food system. These encompass regulatory shifts, supply chain interruptions, fluctuations in ingredient sourcing and pricing, sustainability imperatives, technological advancements, and evolving market trends. 

In March, I had the opportunity to participate in the American Feed Industry Association’s Purchasing and Ingredient Suppliers Conference in San Antonio, Texas. Overall, attendees heard that transportation logistics and employee retention are ongoing challenges in the industry, driving a push for innovation. 

Caitlin Murphy, CEO of Global Gateway Logistics highlighted Global Gateway Logistics’ remarkable contributions in being a small, yet influential player in the freight forwarding services sector. However, she said this impact is not without its challenges, given global logistics trends. The company must yield strategic considerations to hedging ocean rates, environmental concerns, geopolitical tensions, the state of U.S. port infrastructure, advancements in the railroad system and the integration of innovative technology.  

Of note, Murphy underscored the escalating impact that geopolitical and environmental tensions have on shipping costs, saying that events like the ongoing rebel attacks in the Suez Canal and persistent drought conditions in the Panama Canal compel carriers to navigate alternative routes. This exacerbates operational complexities and cost pressures for the animal food industry as it works with foreign suppliers and buyers. 

Murphy stated:  

“Carriers in January and February started to implement some serious fees for diversions through the Red Sea through the Panama Canal. And we are still seeing those surcharges as a Panama Canal surcharge, or Red Sea divergent surcharge. I have not seen any carriers remove either one yet. I do not predict that they are going to anytime soon. So, when you are thinking ahead about your ocean freight rates, just consider doing your research.” 

Switching gears a bit, Kristin Bonham, Vice President, Animal Nutrition and Health - North America, dsm-firmenich, moderated a panel on the people puzzle, another challenge for industry, offering a unique perspective on the factors influencing the feed industry when it comes to attracting new talent, particularly those coming out of college.  

Bonham stated: 

“New hires out of college want to have a clear development path. They want to know how they will further their skills in the roles they select. They want to know what their career path is and then they want to have clear expectations and feedback on their progress. We need to make sure we acknowledge this key factors and lean into new ways to approach our workforce!"

With 50% of the workforce under 40-year-old, Bonham made a great point on how workplace culture is changing across the board. Millennials and Gen Z exhibit distinct characteristics in the workforce, largely shaped by their upbringing, technology immersion and societal influences. These generational nuances shape workplace dynamics, communication styles and organizational cultures, and highlight the importance of employers adapting and accommodating their unique preferences and strengths.  

Bonham's insights showcased the evolving expectations of younger generations in the workforce, emphasizing the need for employers to provide clear development paths and set transparent expectations. 

Overall, the panelists offered many helpful suggestions that companies could begin to explore now, including: 

• Recruiting in new places, such as prisons, where people are looking for second chances to enter society, or at colleges, where students will soon be entering the workforce. 

• Developing career paths that are not carved out by job titles, but by skillsets, so younger generations can have clarity of what will happen next.  

• Rethinking shift work to be less rigid, so employees can achieve the work-life balance they need to take care of young children or elderly parents. 

• Educating potential workers not only about their base pay, but any other benefits the company can provide, so they understand the full package of what the company can offer. This is particularly important given other industries, like the oil/gas industry, may have better starting salaries than the feed industry, but may result in a very different quality of life (e.g., weeks away from home). 

• Consider creating a “trainee program” where employees can work at various facilities throughout the country and become cross-trained, so that when there are exits, these employees could be placed anywhere without a gap in knowledge. 

Looking ahead, the feed industry faces many challenges that directly impact the global food system, ranging from regulatory shifts to navigating the global supply chain to creating a workplace culture that is attractive to the next generation. The insights shared at the conference left much for industry to chew on.