Despite high raw material costs, 2012 was a good year, at least in volume terms, for compounders in Great Britain and Northern Ireland. The latest data available suggests that, in Great Britain, production of compounds, blends and concentrates amounted to 10,205,800 tonnes, up by 581,000 tonnes or 6 per cent on 2011. But what did this mean for the all-important bottom line? Some crude indication may be forthcoming by multiplying the volumes of feed produced by the quarterly price data available for the major product lines - cattle and calf, pigs, poultry and sheep - and comparing the result with an estimate of the cost of raw materials recorded as being used by the industry. But this has obvious disadvantages. Roger Dean has been looking at the dataprovided by companies reports and accounts, both from the compounders' point-of-view and also from that of their customers. He concludes that while the effects of high raw material price volatility can clearly be seen in feed companies' Gross Margin Percentages, data such as Debtor Days contributes little to the discussion.
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