Feed procurement glossary
Feed mill ROI
Definition
Feed mill ROI compares the capital and operating cost of producing feed in-house against the cost of buying finished feed. It depends on tonnage, ingredient access and energy cost.
Why it matters
It is the core justification for building a mill rather than continuing to purchase feed.
When it affects procurement
At the investment decision and again when financing partners review the project.
Example
Comparing the margin between purchased feed price and in-house production cost against annual capital charges.
Frequently asked questions
What is a realistic payback period?
It varies widely by market, tonnage and energy cost. Model it with your own delivered ingredient and feed prices rather than a generic figure.