Note: Descriptions are shown in the official language in which they were submitted.
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SYSTEM AND METHOD FOR ANIMAL FEED MARKET ANALYSIS
FIELD OF THE INVENTION
[00011 The present invention relates generally to the field of
animal feed market analysis. More particularly, the present invention relates
to
computerized systems and methods for evaluating the impact of a modification
in the nutrient composition of an ingredient or the impact of a new ingredient
on the value of the ingredient and the value of competing ingredients in an
animal feed market.
BACKGROUND OF THE INVENTION
(0002] In general, anima! feed products are compositions of a
large variety of raw materials or ingredients. The ingredients can be selected
using two criteria. This first criteria is the nutritional composition of the
ingredient. The second criteria is the cost of the ingredient.
[0003] The nutritional composition of a feed ingredient can be
used in combination with the nutritional composition of every other ingredient
in the feed to produce an animal feed that optimizes the growth and production
of the animal and/or economic return. Animal feed producers have recognized
that certain nutritional compositions help animals to grow larger faster than
if
they used other nutritional compositions. Additionally, animal feed producers
have recognized that high amounts of certain nutrients can actually impede the
growth rate of an animal. Further, animal feed producers have recognized that
optimal nutritional composition changes depending on the developmental stage
of the animal in question (e.g. newborn, weaning, gestating). The ideal
nutrient composition can also change based on additional factors, including
the
health of the animal and whether the animal is nursing. Therefore, animal feed
producers have recognized that by mixing ingredients to produce an ideal
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nutritional composition for particular animals at particular growth stages,
they
can maximize the growth of an animal.
[0004] The second criteria for selecting animal feed ingredients
is the cost of the ingredients. Although one ingredient may have an ideal or
better nutritional profile, if it can be replaced by lower cost ingredients,
it may
be desirable to use the lower cost ingredients. Cost of ingredients and growth
maximization are balanced against each other. For example, where a high
growth rate for a particular animal is not economically advantageous because
of, for example, seasonal markets or quantity demand,, an animal producer may
elect to use a less costly feed that does not produce the same growth rate.
[0005] Raw ingredient producers can attempt to maximize the
nutritional composition of their product for the lowest cost. Raw ingredient
producers often maximize the nutritional composition of the ingredient by
either
producing a new ingredient or improving the nutritional composition of an
existing ingredient. In determining what to research and produce, raw
ingredient producers evaluate the value of the new ingredient or the
ingredient
with an improved nutritional composition. There is no easy method for
predicting value of new ingredients because they are new.
[0006] Thus, there is a need for a system and method that can
help predict the value of a new ingredient or an ingredient with a modified
nutritional composition. Further, there is a need for such a system and method
that can help predict the effect of the new ingredient or ingredient with a
modified nutritional composition on the value of existing ingredients in an
animal feed market.
SUMMARY OF THE INVENTION
[0007] An exemplary embodiment is related to an animal feed
market analysis system for evaluating the impact of a new ingredient or an
ingredient that has a modified nutrient composition on the economic
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value of the ingredient and the economic value of existing ingredients that
could substitute for the new or modified ingredient. This system can include
an input device configured to receive a nutrient profile for the new or
modified
ingredient, a processor configured to receive the nutrient profile from the
input
device and perform a calculation based in part on the nutrient profile, and an
output device configured to provide a calculation result provided by the
processor, wherein the processor is configured to predict a projected economic
value of the new or modified ingredient.
[0008] Another exemplary embodiment is related to an animal
feed market analysis system operable in a network environment for evaluating
the impact of a new ingredient or an ingredient that has a modified nutrient
composition on the economic value of the ingredient and the economic value of
alternative existing ingredients. This system can include a means for
receiving
a nutrient profile for the new or modified ingredient and a means for
predicting
the economic value of the new or modified ingredient.
[0009] Another exemplary embodiment is related to a system
for providing access to an animal market feed analysis system. This system
can include using a first processing system to maintain an animal feed market
information processing unit, the animal feed market processing unit receiving
and processing requests for valuation of a new or modified animal feed
ingredient and a second processing system configured to transmit a signal
requesting the animal feed market information via a network. The signal can
be transmitted by the second processing system in response to selection of a
hypermedia link.
[0010] Another exemplary embodiment is related to a system
for determining the economic value of a new ingredient or an ingredient with a
modified nutrient composition. This system can include an input device
configured to receive a nutrient profile for a new or modified ingredient from
an
input device, a data repository configured to access animal feed market
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conditions, and a processor configured to determine projected economic value
for the new or modified ingredient.
[0011] Another exemplary embodiment is related to an animal
feed market analysis method for evaluating the impact of a new ingredient or
an ingredient that has a modified nutrient composition on the economic value
of the ingredient and the economic value of existing ingredients that could
substitute for the new or modified ingredient. This method can include
receiving a nutrient profile for the new or modified ingredient, predicting
projected economic value of the new or modified ingredient.
[0012] Another exemplary embodiment is related to a method
of enabling access to an animal market feed analysis system. This method can
include using a first processing system to maintain an animal feed market
information processing unit that receives and processes requests for valuation
of a new or modified animal feed ingredient, receiving a signal for invoking
the
animal feed market information processing unit for a remote processing system
via a network where the signal is transmitted from the remote processing
system in response to a selection of a hypermedia link, and using the first
processing system to operate the animal feed market information processing
unit in response to the signal.
[0013] Another exemplary embodiment is related to a method
of determining the economic value of a new ingredient or an ingredient with a
modified nutrient composition. This method can include receiving a nutrient
profile for a new or modified ingredient from an input device, accessing
animal
feed market conditions, determining an economic value for the new or modified
ingredient.
Other principle features and advantages of the invention will
become apparent to those skilled in the art upon review of the following
drawings, the detailed description, and the appended claims.
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BRIEF DESCRIPTION OF THE DRAWINGS
[0014] The exemplary embodiments will hereafter be described
with reference to the accompanying drawings, wherein like numerals denote
like elements, and:
[0015] [0016] FIGURE 1 is a general block diagram illustrating a
stand alone computing system in accordance with an exemplary embodiment;
[0017] FIGURE 2 is a general block diagram illustrating
computers operating in a network environment in accordance with an
exemplary embodiment;
[0018] FIGURE 3 is a web page in accordance with an
exemplary embodiment;
[0019] FIGURE 4A is a flow diagram illustrating a method for
evaluating the impact of a modification in a nutrient composition of an
ingredient or the impact of a new ingredient on the value of the ingredient
and
the value of competing ingredients in accordance with an exemplary
embodiment;
[0020] FIGURE 4B is a map depicting regional market
designations based on concentrations of types of animals in accordance with
an exemplary embodiment;
[0021] FIGURE 5 is a general block diagram illustrating a data
repository in accordance with an exemplary embodiment; and
[0022] FIGURE 6 is a flow diagram illustrating steps in
calculating the impact of a modification in the nutrient composition of an
ingredient or the impact of a new ingredient on the value of the ingredient
and
the value of competing ingredients in accordance with an exemplary
embodiment.
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DETAILED DESCRIPTION OF EXEMPLARY EMBODIMENTS
[0023] A system and method for evaluating the impact of a
new ingredient or a modification in the nutrient composition of an ingredient
on
the value of the ingredient and the value of competing ingredients are
described. In the following description, for the purposes of explanation,
numerous specific details are set forth in order to provide a thorough
understanding of the present invention. It will be evident, however, to one
skilled in the art that the exemplary embodiments may be practiced without
these specific details. In other instances, structures and devices are shown
in
diagram form in order to facilitate description of the exemplary embodiments.
[0024] In at least one exemplary embodiment illustrated below,
a computer system is described which has a central processing unit (CPU) that
executes sequences of instructions contained in a memory. More specifically,
execution of the sequences of instructions causes the CPU to perform steps,
which are described below. The instructions may be loaded into a random
access memory (RAM) for execution by the CPU from a read-only memory
(ROM), a mass storage device, or some other persistent storage. In other
embodiments, hardwired circuitry may be used in place of, or in combination
with, software instructions to implement the functions described. Thus, the
embodiments described herein are not limited to any particular source for the
instructions executed by the computer system.
[0025] FIGURE 1 illustrates a standalone computer system 400
that can be used to evaluate the impact of a modification in the nutrient
composition of an ingredient or the impact of a new ingredient on the value of
the ingredient and the value of competing ingredients. Computer system 400
can include a processor 420, a visual display unit 430, an input device 440,
and an output device 450. Standalone computer system 400 can further be
associated with a memory storage unit such as data repository 200, described
with reference to FIGURE 5, such that computer system 400 can access data
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stored within data repository 200.
[0026] Computer system 400 can be any type of computing
device, including work stations, laptops, notebooks, personal digital
assistants
(PDAs), or other equipment capable of receiving input from input device 440,
accessing data repository 200, executing a series of instructions and
providing
an output to visual display unit 430 or output device 450. Processor 420 can
be any type of processor capable of executing instructions, such as an Intel~
Pentium~ processor. Visual display unit 430 can be any type of visual display,
such as a CRT tube monitor or an LCD display screen. Input device 440 can
be a keyboard, a touchpad, voice recognition, file transfer, or any other
method
or apparatus for communicating information to standalone computing system
400. Output device 450 can be a laser printer, a dot matrix printer, an email
program, or any other method or apparatus of communicating information from
standalone computing system 400.
[0027] According to an exemplary embodiment, a customer
seeking a value analysis for a new or modified ingredient can utilize the
methods described with reference to FIGURES 4-6 using computer system
400. The customer can use input means 440 to provide necessary inputs.
Computing system 400 can be used to implement an ingredient valuation
system in which processor 420 can receive the inputs, access data repository
200 for additional required information, and perform necessary calculations.
The results of the analysis can be provided alternatively on visual display
unit
430 or output device 450.
[0028] FIGURE 2 illustrates a feed market analysis system 500
to evaluate the impact of a modification in the nutrient composition of an
ingredient or the impact of a new ingredient on the value of the ingredient
and
the value of competing ingredients. System 500 can include a first computing
system 520, a computer network 530, and a second computing system 540.
Second computing system 540 further includes a web browsing application
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550 capable of displaying a web page 600 provided by first computing system
520, described with reference to FIGURE 3.
[0029] First computing system 520 and second computing
system 540 can be any type of computer system, such as standalone
computing system 400, discussed in reference to FIGURE 1. Computing
system 520 and second computing system 540 further include devices for
communicating over network 530. Additionally, first computing system 520
further can be associated with data repository 200 such that first computing
system 520 can access data stored within data repository 200.
[0030] According to an exemplary embodiment, network 530 is
the Internet, a worldwide network of computer networks that use various
protocols to facilitate data transmission and exchange. Network 530 can use a
protocol, such as the TCP/IP network protocol or the DECnet, X.25, and UDP
protocols. According to alternative embodiments, network 530 can be any
type of network, such as a virtual private network (VPN), an Ethernet, or a
Netware network. Further, network 530 can include a configuration, such as,
a wide area network (WAN) or a local area network (LAN). Network 530
preferably provides communication with a Hypertext Markup Language (HTML).
[0031] Web browsing application 550 can be any type of
application capable of accessing information stored on ~ other computing
systems over network 530. Examples can include applications such as
Internet Explorer~ sold by Microsoft Corporation of Redmond, WA or
Netscape°
sold by Netscape Communications Inc. of Mountain View, CA. According to
an exemplary embodiment, web browsing application 550 can be used to
access first computing system 520, to receive data, and to display web page
600. An exemplary web page is described with reference to FIGURE 6.
[0032] According to an exemplary embodiment, a customer
seeking to utilize system 500 to evaluate the impact of a modification in the
nutrient composition of an ingredient or the impact of a new ingredient
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on the value of the ingredient and the value of competing ingredients can
access second computing system 540 and run web browsing application 550.
Web browsing application 550 can be directed to retrieve web page 600 from
first computing system 520 over network 530.
[0033] Once retrieved, web page 600 can be used by the
customer to provide necessary inputs. The necessary input can include
customer ingredient input described with reference to FIGURE 4A. According
to an exemplary embodiment, an exemplary method of providing information
through web page 600 is discussed below in reference to FIGURE 3. First
computing system can receive the inputs and access data repository 200 to
gather information necessary to perform the evaluation of value. First
computing system 520 can then transfer evaluation results to second
computing system 540 over network 530 for display on web page 600.
[0034] According to an exemplary embodiment, web page 600
can require satisfaction of a log on procedure prior to performing the
evaluation
and transferring evaluation results. An example of a log on procedure can
include provision of a use name and password in designated text entry boxes
provided on web page 600 that correspond with stored values.
[0035] FIGURE 3 illustrates a web page 600 of an exemplary
embodiment of web page 600. Web page 600 is a visual display of a
document written in HyperText Markup Language (HTML) including embedded
pictures, links, and data fields. Web page 600 can be a single web page or a
series of web pages accessed through embedded links in a first web page. A
first web page in a series can include a username and password access control
method to provide customer recognition.
[0036] According to an exemplary embodiment, web page 600
can include a title 603, an instruction set 605, a new or modified ingredient
nutrient profile input field 610, a region input field 620, an animal type
input
field 630, and an output field 640. Title 603 can be used to identify
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the page and include proprietary graphics identifying the source of the page.
Instruction set 605 can be an information necessary for the customer to
utilize
the ingredient valuation system and method.
[0037] Input fields 610, 620 and 630 can be implemented as
text entry fields, selectable drop down menu field, file transfer points, or
any
other method in which the necessary information would be inserted for transfer
to first computing system 520. Output field 640 can be a downloaded file, a
spreadsheet embedded object, or any other means in which calculation results
transferred from first computing system 520 can be displayed. An example
could be a spreadsheet populated with the results of the analysis including
graphs, charts, and description to explain the calculation results.
[0038] According to an exemplary embodiment, the customer
can use web browsing application 550 to access web page 600. Web page
600 can be displayed on the visual display unit for second computing system
540. The customer can read instruction set 605 to understand how to utilize
the ingredient valuation method and web page 600. The user can enter data in
input fields 610, 620, and 630 with data as described with reference to
FIGURE 4A. Once the data is entered, the system can process the information
using the method described with reference to FIGURE 4A. The results of the
ingredient valuation method can be returned to the user in output field 640.
[0039] FIGURE 4A illustrates a flow diagram 100 depicting
steps in a method for evaluating the impact of a modification in a nutrient
composition of an ingredient or the impact of a new ingredient on the value of
the ingredient and the value of competing ingredients. A new ingredient can
be a new composition of matter that has nutritive properties that can be used
in animal feed. A modified ingredient can be an existing ingredient with some
aspect of its nutrient profile modified. A competing ingredient can be an
ingredient that can be used as a substitute for the new or modified
ingredient,
either singly or in combination with other competing ingredients.
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[0040] According to an exemplary embodiment, in a step 1 10,
customer ingredient information is received. According to one embodiment, a
human operator performs the method and facilitates information transfers and
information gathering. According to this exemplary embodiment, information
can be received by the operator through a person to person communication,
either direct or indirect. According to an alternative embodiment, customer
ingredient information can be received by a stand alone computer system using
any type of input device such as a keyboard, a mouse, a voice recognition
system, etc. An exemplary stand alone computer system is described with
reference to FIGURE 1. According to an additional alternative embodiment,
customer ingredient information can be received by a computer operating in a
network environment. An exemplary network embodiment is described with
reference to FIGURE 2.
[0041] The customer ingredient information conveyed by the
customer can include a nutrient composition for the new or modified
ingredient, a potential market for the new or modified ingredient, and a type
of
animal targeted to be fed by the new or modified ingredient. The nutrient
composition of the new or modified ingredient generally can include physical
and chemical properties, such as, mineral content, vitamin content, particle
size, fiber content, etc.
[0042] A potential market can include a specific geographic
area, such as a state or a region, a trade organization, such as a commodities
market, or any other type of market. The potential market can be a customer
definition of the desired market, a customer selection from a finite number of
defined markets, or any other method wherein the customer indicates the
market to be examined based on any of a variety of criteria.
[0043] FIGURE 4B illustrates a market designation map 180 of
the United States including a finite set of markets established based upon
concentrations of specific types of animals. Market designation 181
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encompasses a geographical area wherein there may be a high concentration
of swine producers. Market designation 182 encompasses a geographical area
wherein there may be a high concentration of bovine producers. The type of
animal targeted to be fed by the new or modified ingredient can be any type of
animal, including cows, pigs, turkeys, fish, etc.
[0044] Returning to FIGURE 4A, following step 1 10, a step 120
is performed in which data can be retrieved from a data repository. The data
can be retrieved from a data repository or obtained from any other source.
According to an exemplary embodiment, an operator can retrieve the data by
referencing the data repository or by using other sources of information. The
other sources of information can include, but is not limited to, newspapers,
the
Internet, market reports, trade journals, etc.
An example of a data repository is described further with
reference to FIGURE 5. Generally, the type of data stored on the repository
can be any information necessary or useful in predicting the impact of a new
ingredient or a modification in the nutrient compositiori of an ingredient on
the
value of the ingredient and the value of competing ingredients.
[0045] Data stored in the data repository can be archived values
based upon a study performed yearly. An example of this type of data can be
projected animal populations within a given region. Alternatively, the data
repository can be used to access data that updates daily, hourly, or even
continuously. An example of this type of data can be the prices for competing
ingredients. This data can be continuously updated using a polling method or
an Internet link to a price indicator in a commodity market as examples.
[0046] After step 120, a step 130 can be performed in which a
value is determined for the new or modified ingredient. An exemplary value
determination is described with reference to FIGURE 6. Generally, the
determination can be performed to predict the new value or change in value of
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a new or modified ingredient based on the inputs given as described above.
[0047] After step 130, a determination can be made in a step
140 whether the value or change in value of the new or modified ingredient
has an effect on the value of competing ingredients. This determination can be
based on a number of factors. The factors can include the projected market
penetration for the new or modified ingredient, the output production
capability
for the new or modified ingredient, etc.
[0048] If a determination is made in step 140 that the value or
change in value of the new or modified ingredient has an effect on the value
of
competing ingredients, a step 150 can be performed wherein a new predicted
value for competing ingredients is calculated. Following this calculation,
step
130 can be repeated using the new values for the competing ingredients. This
loop condition, including steps 130, 140 and 150, can be repeated until a
stable system is established. A stable system is established when ingredient
prices within the method will not change in reaction to other ingredient
prices.
[0049] If a determination is made in step 140 that the value or
change in value of the new or modified ingredient does not have an effect on
the value of competing ingredients, a step 160 can be performed in which an
analysis of the value of the new or modified ingredient is delivered. The
analysis can be as simplistic or complex as required by the customer. An
example of a simplistic analysis can be a simple price value at which value
will
be maximized. An example of a complex analysis can include prices at which
value is maximized at varying levels of production, prices at which the value
of
competing ingredients will not be affected, etc.
[0050] Advantageously, the ingredient valuation method,
described with reference to FIGURE 4A can be offered as a service to
ingredient producers, researchers, or others. Alternatively, the method can be
used as an internal evaluation tool. Customers, external or internal, can be
ingredient producers that are considering production of a new
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ingredient or an ingredient with a modified nutrient composition. Customers
may also be researchers that are considering development of a new ingredient
or a method to improve the nutrient composition of an existing ingredient.
Potential customers can be any person with a need to know the impact of a
modification in the nutrient composition of an ingredient or the impact of a
new ingredient on the value of the ingredient and the value of competing
ingredients.
[0051] FIGURE 5 illustrates a data repository 200 that can be
used to store information that can be used in determining the value of a new
or
modified ingredient. Generally, information in data repository 200 is related
to
potential markets in which a customer may be intending to sell the new or
modified ingredient. Data repository 200 can be a computer including memory,
a database, a computer file, a paper file, or any other device or apparatus
capable of facilitating storage and retrieval of data.
[0052] According to an exemplary embodiment, data repository
200 can include a variety of files, such as regional ingredient file 210, a
regional ingredient price file 220, a regional ingredient bias file 230, a
stage-
based formulation file 240, and an animal population file 250. Other data that
may affect the valuation can also be included or reflected in the above
mentioned categories of information.
[0053] Regional ingredient file 210 can be a record of
ingredients currently or projected to be available in a region. Example
ingredients include corn, wheat, wheat midds, lysine, HCL, and high protein
soy meal. This information can be obtained using market reports, expert input,
or any other source. According to an exemplary embodiment, the region for a
particular entry in regional ingredient file 210 can be designated by the
customer or chosen from a predefined listing. Regional ingredient file 210 can
be an archived file created and stored in data repository 200. This file can
be
updated as necessary to reflect current or projected conditions in the market.
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According to a preferred embodiment, regional ingredient file 210 can also
include a nutrient composition for the ingredients available in the region.
The
nutrient composition can include physical and chemical properties, such as,
mineral content, vitamin content, particle size, fiber content, etc.
[0054] Regional ingredient price file 220 can be a file of the
prices of the ingredients in regional ingredient file 210. The prices can be
the
price of the delivered ingredient. Advantageously, using the delivered price
accounts for transportation costs. Prices can include historical, current, and
projected values. Historical price information can be obtained from existing
records. Current prices can be obtained from any listing, such as, the
newspaper, a web listing, or any other source reporting the current price of
ingredients. Projected values can be obtained by extrapolating from historical
prices based on any relevant current conditions. Regional ingredient price
file
220 can be an archived file stored in data repository 200. Alternatively,
regional ingredient price file 220 can be a link to information reflecting the
most current ingredient prices. This link may be provided by telephone, a
newspaper, the Internet, or any other means. Advantageously, storing and
allowing retrieval of a variety of pricing information allows the customer to
predict a value using the information that is most suitable to meet their
needs.
[0055] Regional ingredient bias file 230 can be a listing of
weights to be given to ingredient in calculating projected use. According to
an
exemplary embodiment, the weighting can include a minimum value for the
amount of an ingredient that is used in a region. An example of weights can
be that a thousand metric tons of corn is used in an upper Iowa region
regardless of any cost inefficiencies. Advantageously, regional ingredient
bias
file 230 accounts for a regional bias in which market participants tend to use
a
given ingredient at a level that is not economically optimal. This value can
be
created using analysis of past market trends, expert predictions, or any other
method. Regional ingredient bias file 230 can be stored values in a file
within
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data repository 200.
[0056] Stage-based nutrient requirement file 240 can be a file
of the nutrient requirements for different types of animals at various stages
of
development and health. Examples of stages of development and health can
include newborn, weaning, young, maturing, gestating, or any other
differentiation that can reflect different nutrient requirements. Generally,
the
nutrient requirements for a newborn animal or a gestating animal are
significantly different from the requirements for a healthy adult animal. For
example, a gestating animal may need a formulation that includes a high
concentration of calcium to promote development of the fetus.
[0057] According to a preferred embodiment, stage-based
nutrient requirement file 240 can also include the volume of feed consumed by
an animal at a given stage. This value can be obtained based on historical
record or expert testimony. An example can be that gestating pigs consume
150 pounds of feed per month. Advantageously, examining the nutrient
requirements at various stages for various animals allows for a more precise
calculation of the projected demand for specific ingredients. Stage-based
nutrient requirement file 240 can be an archived file stored in data
repository
200.
[0058] Animal population file 250 can be a listing of the animal
populations in a region. Examples can include the number of swine, the
number of cows, etc. Animal population file 250 can also be divided into
subgroups based on the stage of development of the animals in the population
as discussed above in reference to stage-based nutrient requirement file 250.
[0059] According to an exemplary embodiment, animal
population file 250 can also include historical, current and projected values.
The historical and current values can be obtained from any source such as a
regional department of agriculture report. The projected population can be
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extrapolated from the historical values based on current conditions.
[0060] Animal population file 250 can also incorporate a market
penetration concept, such that only a subset of the total animal population is
used in calculating demand based on anticipated market penetration.
According to an exemplary embodiment, a subset of the animal population may
be fed using only locally grown ingredients. Accordingly, the locally fed
subset
would be excluded in calculating projected demand.
[0061 ] Advantageously, analysis of stage-based nutrient
requirement file 240 and animal population file 250 allows for calculation of
the projected demand for ingredients based on the nutrient requirements for
the animal population within a given region. This calculation can be performed
using the formulation methods described below in reference to FIGURE 6.
[0062] FIGURE 6 illustrates a flow chart 300 of steps in a
method of calculating the value of a new or modified ingredient. In a step
310, data gathered on customer ingredients can be evaluated. One example of
gathering ingredient information is described with reference to steps 1 10 and
120 in FIGURE 4A. The data is evaluated to detect any aberrations or
departures from the normal that would skew a valuation analysis. This
analysis can be performed with a linear regression analysis or similar method.
Any aberrant values can be reexamined or discarded from the sample set.
[0063] After step 310, a step 320 can be performed in which
information from a memory storage device and information received from the
customer are used as inputs to a least cost formulation system. A least cost
formulation system determines an ideal mix of ingredients, including the new
or
modified ingredient, that satisfies a set of nutrient requirements for the
lowest
possible cost. The set of nutrient requirements is the nutrient requirement
for
a specific animal at a specific stage of development, as described in
reference
to FIGURE 5. Least cost formulation systems are well known to those of skill
in the art. The least cost formulation can be performed for each of the
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stages of development of the animal targeted. Advantageously, completing
formulations for each of the stage of development of the animal target allows
for a more complete prediction of demand.
(0064] After step 320, a determination can be made in a step
330 to determine whether the formulation satisfies feasibility and
wholesomeness requirements. If the formulation is not satisfactory, step 320
can be repeated including additional constraints to improve wholesomeness or
feasibility as needed.
[0065] Following the determination in step 330 that the
formulation is satisfactory, a determination can be made in a step 340 whether
the ingredient to be examined is an existing ingredient with a modified
nutrient
composition or a new ingredient.
[0066] If the ingredient to be examined is determined in step
340 to be an existing ingredient with an improved nutrient composition, a step
350 can be performed. In step 350, the ideal formulations calculated in step
320 can be analyzed in a least cost formulation system. The least cost
formulation system calculates ideal feed mix for a variety of formulations
based
upon market constraints such as production costs, speed of production,
ingredient availability, etc. An example of a least cost formulation system is
Multi-Mix sold by Format International, Limited, Woking, England.
Advantageously, use of a least cost formulation analysis allows evaluation of
the modified ingredient in several formulations to be performed
simultaneously.
In step 350, projected usage rates for all of the ingredients used an inputs
to
the calculation can be provided.
[0067] If the ingredient to be examined is determined in step
340 to be a new ingredient, a step 360 can be performed. In step 360, a least
cost formulation analysis can be performed using the ideal formulations
calculated in step 320 and including only commodities specific to the region.
Following this analysis, an additional feast cost formulation analysis
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can be performed using the ideal formulations calculated in step 320 and
including the new ingredient in addition to commodities specific to the
region.
For this analysis, the new ingredient can be assigned the same price as an
existing ingredient with a similar nutrient composition. Advantageously, this
step provides a realistic starting valuation for a new ingredient. In step
360,
projected usage rates for all of the ingredients used an inputs to the
calculation
can be provided.
[0068] Following the least cost formulation analysis in steps
350 and 360 of the two ingredient sets, a parametric analysis can be
performed on the output from the two least cost formulation analyses to
predict optimal prices for the new ingredient. A parametric analysis is an
examination of the data sets to determine prices above which usage rates drop
dramatically. For example, the usage rate may slowly decrease until a price of
$2.00/pound, but at $2.25/pound, the usage rate decreases dramatically as
users switched to a cheaper alternative. The optimal price may therefore be
$2.00/pound. The optimal price is then used as the new ingredient price in a
final least cost formulation calculation.
[0069] Following step 350 or 360, a step 370 can be
performed in which the usage rates calculated in the least cost formulation
operations are used to calculate the total value created by the introduction
of
the new or modified ingredient. According to an exemplary embodiment, the
calculations can be used to generate an output spreadsheet. The output
spreadsheet can be used to show the volume of the new or modified ingredient
used within the least cost formulation system along with the premium received
above the compared commodity.
[0070] While the exemplary embodiments illustrated in the
figures and described above are presently preferred, it should be understood
that these embodiments are offered by way of example only. Other examples
may include, for example, a wide variety of ways to convey information
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regarding the value of a new or modified ingredient such as, wireless
application protocol (WAP), personal digital assistant (PDA) protocols, and
other presentation means. Further, while exemplary embodiments describe the
invention in the context of animal feed markets, the invention may extend to
other ingredient markets which are components to a formulation. Additionally,
specific information is described above as coming from specific sources for
use
in the system and method, but any information that is relevant, from any
source, can be used in the calculations. The invention is not limited to a
particular embodiment, but extends to various modifications, combinations,
and permutations that nevertheless fall within the scope and spirit of the
appended claims.
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