InnovationsA Publication of Hy-Line International

Investing in Your Future Continued…Hy-Line International recently dedicated a new state-of-the-art research facility, the Dr. Dennis Casey Research Farm. Early in his career at Hy-Line Dr. Casey worked as a research geneticist and then went on to serve as Hy-Line’s President from 1975–2005. Dr. Casey was an inspirational leader contributing immensely to the global success of Hy-line International.

This new farm gives us to have the ability to collect individual bird data from all of our pedigree lines to 90+ weeks of age. This expanded research capacity will accelerate our genetic improvements in persistency of egg production and egg shell quality over longer production cycles. As you know, we have invested heavily in new and upgraded farms over the past 5 years to complement our investments in Genomic Selection. We will have much more genetic information to use in our Genomic Selection analysis for faster and improved selection accuracy, as well as allowing unique mating strategies in the future.

Our new Great-Grandparent farm in Nebraska is now in operation having received its first flock. This farm is an integral part of our overall production base in the USA.

ISSUE 6 • MAY 2014

INSIDE THIS ISSUE:Hy-Line Brown – the World’s Leading Brown Layer! . . . . . . . . . . . . . . . . . 2–3

Hy-Line International Retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4–5, 7

Ovobrand Focuses on Exporting Quality Processed Egg Products . . . . . . 6–7

Ovobrand, Feller and Hy-Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6–7

Hy-Line France Celebrates 10 Year Anniversary . . . . . . . . . . . . . . . . . . . . . . . 7

Dr. Dennis Casey Research Farm InaugurationHy-Line International hosted two separate events in celebration of the unveiling of the new Dr. Dennis Casey Research Farm. The first event included the official dedication and ribbon cutting ceremony. State of Iowa Secretary of Agriculture Bill Northey joined Dr. Casey and Hy-Line senior staff for the ceremony and tour inside the house. Following the dedication ceremony, Hy-Line employees, local cooperators, family and friends were invited to an open house for guided tours led by Hy-Line’s research and technical experts.

Pictured from left to right Dr. Doug Grieve, Dr. Antonio Paraguassu, Sec. of Agriculture Bill Northey, Dr. Dennis Casey, Maria Casey, Angela Derby, Dr. Neil O’Sullivan, and Jonathan Cade

Continued on pg. 3

Continued on back pg.

PAGE 2 • ISSUE 6

Hy-Line Brown – the World’s Leading Brown Layer!Some 40 years ago, the Hy-Line Brown was introduced and has continued to grow in popularity around the world. It now enjoys the enviable position as the world’s leading brown egg layer. However, that wasn’t a sure and easy accomplishment – in fact, it took some years of trial and error before the right combination of genetic lines was found that allowed the bird to progress to her current status. Some of the Research &

Development team involved in the Hy-Line Brown’s development have shared their observations to help document the evolution of the bird.

Even before Hy-Line was founded in 1936, H. A. Wallace and geneticists at Pioneer had bred brown egg lines. They worked with white egg lines as well, and during the late 1940’s and early 1950’s, Hy-Line’s major product was a tint/cream egg layer which was the result of a cross of a White Leghorn male with a brown egg-laying female. This layer was very popular due to high egg numbers, but eventually fell out of favor due to a susceptibility to lymphoid leucosis. (She was replaced by the 934 series of white egg layers which was more resistant to lymphoid leucosis.)

After serving as United States Secretary of Agriculture and U. S. Vice President, H.A. Wallace retired to his farm in New York, where he worked with brown egg stocks, assisted by Hy-Line geneticist Lloyd

Switzer. They improved the lines in the brown program for many years without entering the market.

During the early 70’s Hy-Line was growing around the world and many markets demanded a brown egg layer. After some initial, disappointing results geneticist Jason Beck focused on the brown egg layer and got her “up to Hy-Line standards”. As the saying goes, it was “back to the drawing board” and an intense effort was applied to get an appropriate product developed.

The renewed research effort proved to be successful and after a few more years of intense selection and trials, the Hy-Line Brown was ready to be introduced to the global market. The Hy-Line sales team was able to offer a competitive bird to their international clients. At that time, well over 15 brown egg layers were available – with many global, regional and local competitors all competing for the brown egg layer market. The Hy-Line Brown was recognized for her high livability and disease resistance, high egg mass with low feed consumption and superior egg quality. The only thing missing was a consistent and

dark egg color – a characteristic that was further improved upon in the subsequent decades such that now her consistent dark eggs make the Hy-Line Brown the undisputed leader in egg color.

Over 30 years ago, Hy-Line International was the first international company allowed to enter the Chinese market which was growing exponentially. The Hy-Line Brown was the lead product as the US company cautiously learned how to compete with local layers and subsequently, those of other international companies. Chinese layer customers found the Hy-Line Brown quite adaptable to their production systems and haven’t found another layer able to measure up to her production results. In fact, today the Hy-Line Brown enjoys an amazing 60% market share in China which produces over 35% of the world’s eggs!

That same adaptability which made the Hy-Line Brown popular with Chinese customers has been noted by egg producers around the world. The Hy-Line Brown has shown outstanding performance in free-range production in Europe and Australia, in floor production in Colombia, in aviary production in

With humble beginnings and strong competition, the Hy-Line Brown has proven herself to be a

long-term success.

MAY 2014 • PAGE 3

The location in Nebraska provides risk mitigation and supply continuity of Hy-Line genetics in the event of disease outbreak in Iowa which could cause a barrier to international trade.

Our Global Technical Service team has been strengthened with the hire of Dr. Robert Van Wyhe. Robert is a recent graduate of Michigan State University in the area of nutrition. His work complements our existing global team of experts with a key focus on nutrition and optimum feeding advice for our varieties.

We recently launched two new management guides for our Hy-Line Brown Parent Stock and Commercial Layers. These guides have updated management recommendations and new performance standards reflecting our recent genetic improvements in productivity. Our technical experts from Research and Technical Service Departments in consultation with our local regional technicians have worked tirelessly on the creation of these guides. Our Marketing group has done a fine job in organizing these guides in a focused, easy to understand and pictorial way. I believe these are two of the best guides yet produced and will help our customers exceed the genetic potentials detailed in the performance standards sections.

Those of you attending the VIV Exposition in Utrecht, Holland in May will meet some of our new team members at the Hy-Line booth. Please visit us and let’s work together to discuss areas of interest and explore ways that we can work together more effectively. We are always interested in your feedback of how we can improve our service. This feedback is important in our decision-making process for breeding our future layer varieties.

A part of ‘investing in your future’ is the importance of growing good quality pullets. Pullets are our future - invest in them and they will deliver the results. In the coming year, this will be an area of emphasis for our Technical Service team during their customer farm visits and in technical literature. I believe that focus in this area will pay dividends during the laying period. At the VIV our team is waiting to discuss pullet growing programs that will best optimize your Hy-Line layer performance.

I thank you for investing in Hy-Line and I promise we will continue to invest in our business for your future.

Sincerely,

Jonathan Cade, President, Hy-Line International

Investing in Your Future continued from pg. 1

Europe and the US, as well as cage production in hot and cold climates.

Over the years, continued improvements have strengthened the position of the Hy-Lien Brown. During the 1990’s an intense effort was focused on the egg weight profile which had a large range throughout lay. Now producers notice a very desirable size of about 50g as first eggs and eggs below 65g at the end of lay. Likewise, newer technologies became available to evaluate shell color and selection pressure has resulted in the Hy-Line Brown leading the industry in consistent shell color throughout lay.

What can we expect in the future from the Hy-Line Brown? Dr. Petek Settar, Population Geneticist, observes the pure lines daily working on the research farms. With her colleagues she continues to select for even higher persistency of lay and the body weights required to sustain that production. She says, “We are also very excited about the continued improvements in egg shell color and egg quality that will be evident in future generations of the Hy-Line Brown. We are also working to be able to offer options for some different egg size profiles in the future.”

With humble beginnings and strong competition, the Hy-Line Brown has proven herself to be a long-term success. Efficient production of high-quality brown eggs has made her truly the world’s most popular egg layer – of any color!

Dr. Dennis Casey–a Hy-Line Legend Reflects on His CareerA discussion of the success of Hy-Line International always includes the name, Dr. Dennis Casey. His 36 years of service to the company – 30 as President, have left an important mark on the global layer industry. Though officially retired from Hy-Line, he continues as a consultant for Hy-Line North America and is very active in the layer industry.

Born in northwest Iowa, Dennis grew up on a farm and his chores included caring for the family’s flock of 200 layers. “I did not like those chickens”, he says, but that was most likely due to the work cleaning the chicken house and gathering the eggs. After graduation from high school, he studied at Iowa State University majoring in Agricultural Business. His first job was selling day-old chicks in Litchfield, Minnesota in a company owned by Bob Sparboe who also became an important mentor for Dennis. Today, Sparboe Farms continues as one of the 10 largest egg producers in the US and an important customer of Hy-Line.

After 18 months of selling chicks, graduate school was the next step for Dennis. He was accepted again at Iowa State in the poultry breeding program, obtained his master’s degree and then 2 years later, his PhD in poultry genetics. Fresh from the university, Dennis went to work as a geneticist on the research farm for the company from which he would retire, Hy-Line International. His first project was to develop the male line that would be used to produce the Hy-Line W-36 – a line that continues to this day. Three years later he was appointed to run the West Coast distribution and in 1975 was appointed

President. Hy-Line was struggling at the time and the company included separate layer and breeder sales forces, was growing and selling 2 million started pullets a year and contracting with farmers who kept 3 million layers in production. Dennis recognized the company needed to focus on one business to be successful and despite the fact that there were many competitors in the US alone; he decided the original focus of breeding would be the way forward. The other businesses were sold off and Hy-Line soon returned to profitability and a growth plan that has been ongoing ever since.

Another interesting fact is that Dennis succeeded Henry B. Wallace as president of Hy-Line after HB had led the company for 35 years. At this time Hy-Line was owned by Pioneer Hi-Bred Corn Company, a global leader in plant genetics founded by HB’s father, Henry A. Wallace, who also served as Vice President of the United States and Secretary of Agriculture under President Franklin D. Roosevelt. Not only did HB mentor Dennis during his years in the business, they remained life-long friends until HB passed away in 2005.

The early years as President were challenging as the company debated how to position itself in a highly fragmented layer industry which was rapidly starting to consolidate. After much internal debate, Dennis led the effort to acquire many of Hy-Line’s

US distributors in an effort to have total control of product supply and quality. And then only 3 years later Hy-Line was purchased by a German family-owned company, Lohmann, who pressured Casey to drop the brown egg program as US consumers preferred white eggs by this point in time. But recognizing the growing international demand for US genetics and brown egg layers, Dennis held firm and kept progress moving forward with the brown egg programs. Soon Lohmann experienced financial challenges with the company ending up in hands of a bank until another German family, the Wesjohanns, stepped in and purchased the Lohmann assets.

Over the next decades, Hy-Line continued its rapid growth. As US farms became larger and moved to all-in, all-out pullet housing the number of chicks per order grew exponentially. In order to supply those large orders, Hy-Line continued purchasing distributors and invested in larger and larger hatcheries strategically located throughout the country. The success of the W-36 in the US continued as well as other specialty products to allow Hy-Line to become the undisputed market leader.

Likewise, international sales also started to climb and Hy-Line became

An occasional feature to share an update with their many friends around the world

Retirees HY-LINE INTERNATIONAL

PAGE 4 • ISSUE 6

“people built Hy-Line – they are the key to the company’s success”.

established across the world. Long before China’s economic policies were liberated, Hy-Line was firmly entrenched and continues to dominate there where over 35% of the world’s eggs are produced. Soon Hy-Line was also investing in company-owned distribution in the UK, South Africa, Japan and Brazil and forging strong partnerships with distributors in all other major egg markets.

When asked to explain the reasons for Hy-Line’s success, Dennis refuses to take credit beyond “providing leadership”. He cites four key accomplishments:

1. Better products — genetic improvement is a slow process, but Hy-Line has always focused on having the best feed conversion, highest livability and superior egg quality. Those benefits continue to provide great value today as they did from the company’s humble start.

2. Infrastructure — production and distribution around the world to meet the customer’s demands

3. Service, service, service — Dennis points out that happy customers have no reason to consider competitive birds. Technical service veterinarians and nutritionists help keep Hy-Line birds leading the industry

4. People — Dennis is especially proud of what has become recognized as the Hy-Line family – a strong continuity of good people who have worked long careers at Hy-Line with a passion for the industry. He emphasizes “people built Hy-Line – they are the key to the company’s success”.

Throughout his career Dennis also served the egg industry in many ways. He has been a longtime member of the International Egg Commission, sat on the boards of the Southeastern Poultry and Egg Association, United Egg Producers allied industry group, was past chairman of the Midwest Poultry Consortium, of which he was a founding father along with Bob Sparboe, served as the allied industry advisor to the American Egg Board, and currently serves as Chair of the Egg Industry Center.

His hard work has also earned him many awards over the years.

They include induction into the Department of Animal Science “Hall of Fame” at Iowa State University in Ames, Iowa, the Denis Wellstead award for “International Egg Person of the Year” from the International Egg Commission, the Iowa Poultry Association and Egg Industries “Lifetime Membership” award, and the Midwest Poultry Consortium’s “Outstanding Service” award. Dennis was also the recipient of the United Egg Producers’ “Industry Person of the Year” award and the Floyd Andre Award honoring an Iowa State University alumnus who has made a significant influence on Iowa agriculture.

Since “retiring” in 2005, Dennis has new goals in life. He jokes his most important effort is “trying to become the person my dog thinks I am”. Dennis and his wife Maria have an active household with family, friends and pets dropping by throughout the day. With daughters Angela and Jennifer living close by with their respective families, Dennis and Maria enjoy caring for the dogs of all three families during the day while their owners are at work. Angela’s son Hunter often comes to spend part of the afternoon as well. Dennis enjoys year-round golf in Iowa and Arizona where they have a winter home. Dennis jokes “I like winter in Iowa – at least for a couple of days”.

While his work day is not quite as stressful, Dennis continues to work as a consultant for Hy-Line North America, is the Chair of the Egg Industry

Dennis, Maria and the dogs

MAY 2014 • PAGE 5

Continued on pg. 7

PAGE 6 • ISSUE 6

Ovobrand Focuses on Exporting Quality Processed Egg Products

A progressive Argentine company, Ovobrand, offers an impressive story of entrepreneurial spirit that demonstrates the power of inspiration in today’s global marketplace. Dr. Gustavo von Bassenheim, CEO of Ovobrand, had worked for many years in the local egg production industry and developed a dream to export egg products. Recognizing a competitive cost of production due to Argentina’s abundant production of corn and soya, Gustavo was confident that with exceptional quality control, Ovobrand could compete in the international processed egg market. He labored for months developing a business plan, farm and production designs and market studies. “When you believe in your product, there isn’t much negotiating that needs to be done”, he emphasized. He identified some local partners in Argentina and his dream began to

take shape.

The project broke ground in January 2008

on a brand new complex located on 1300 hectares. To ensure strict biosecurity the facility was located in an area isolated from commercial poultry production with abundant local grain availability and 80 km from the harbor. Over 6 km of roads were built to allow for efficient internal movement within the complex. A dedicated feed mill with grain storage feeds the 1.5 million layers in production and 350,000 pullets. The grain silos with a storage capacity close to 6.000 metric tons have elevated flat bottom floors to encourage air flow and keep the grain in optimum condition reducing the risk of mycotoxins affecting feed quality.

All growing and laying houses are built with double walls of brick and double sheets of metal for the roof, all with two layers of insulation to control house temperatures, reduce energy consumption and allow proper sanitization. New enrichable stacked deck cages were purchased anticipating future welfare requirements for products to be sold in international markets.

Gustavo is especially proud on an innovative biogas project that converts manure produced by pullets and layers, waste water from the egg processing plant, sorghum silage and other minor residues into biogas (900 m3 biogas / hour, mainly methane) that is then used by the egg processing plant (over one megawatt each of electrical and thermal energy). One of his project goals is to be a good steward of the land and to produce sustainable products. The final product produced in the biogas plant is a high value fertilizer which is in high demand by intensive crop producers.

The final part of complex contains an egg packing station as well as the processing plant. Ovobrand is able to export shell eggs and also participates in the Argentine shell egg market. The processing plant is

Dr. Gustavo van Bassenheim

Ovobrand, Feller and Hy-LineHaving worked in the breeding industry previously, Dr. Gustavo von Bassenheim feels confident that the Hy-Line W-36 is the least-cost egg layer available. He works closely with Hy-Line’s Argentine distributor, Cabaña Avícola Feller, to supply of 100% of his operation’s pullet needs. Under the direction of the Motta family, Cabaña Avícola Feller has built a new state-of-the-art breeder facility, COBISE, which was featured in the previous issue of Innovations. Hy-Line is privileged to have the confidence of Ovobrand as demonstrated by 100% use of the Hy-Line W-36 in the operation.

Continued from pg. 5

MAY 2014 • PAGE 7

Hy-Line France Celebrates 10 Year AnniversaryFrom a humble beginning in 2004 with only 3 employees, Hy-Line France has expanded rapidly over the past 10 years to now enjoying almost 30% market share in the competitive French market! Indeed, the entire French layer industry has been undergoing dramatic changes in the last decade with new animal welfare legislation impacting housing and husbandry practices, as well as ever-evolving consumer demands.

In 2007 an important strategic investment was made in the purchase of the commercial layer division of an important French industrial group. Hy-Line France was able to quickly double its market presence with a dedicated hatchery and expanded team which allowed sales and technical service to expand across the country.

FRENCH EGG INDUSTRY

Layers in Production 46,000,000

Brown / White Eggs 85% / 15%

Colony Production 70%

Average Egg Weight 64 g

Per capita consumption 205 eggs / year

Exports 29,700 tons of liquid/dry

egg products

Imports 42,700 tons of liquid/dry

egg products

ARGENTINE EGG INDUSTRY

Layers in Production 42,500,000

Brown / White Eggs 45% / 55%

Colony Production 98%

Average Egg Weight 63 g

Per capita consumption 244 eggs / year

Exports 6,160 tons of shell eggs & liquid/dry egg products

Center and serves on the board of the Midwest Poultry Consortium. He is an active investor in several egg operations in the Midwest, including a large cage-free egg producer in the US.

Dennis also is a partner in and serves as President of Biova, based at the Iowa State Research Park in nearby Ames, Iowa. He was one of the founders this company created to develop products from the egg membrane left behind after the liquid contents are harvested in egg breaking facilities. The process includes a patented mechanical process that removes the egg membrane from the shell, as well as another process that concentrates the membrane into a water-soluble intermediate ingredient called Ovacore™. Further processing then creates a variety of highly concentrated protein products that are used in joint health products for humans and companion animals, as well as serving as an important component in anti-aging cosmetics and wound-care products.

capable of producing both liquid and dry egg products, including whole eggs, yolks, whites and custom blends. The plant’s laboratory is equipped with the latest technology which has helped Ovobrand meet all EU and Japanese requirements, the strictest in the global market.

Gustavo also is largely responsible for international sales of Ovobrand products – both direct to customers and through brokers. Currently Ovobrand is exporting to customers in 17 countries.

Leading Ovobrand through a transformation from green fields to a global business in little over 6 years, Gustavo has not been able to accomplish this enormous task alone. A strong team of quality specialists in their fields has been employed. Focused and continued training and process improvement creates an environment where employees also demonstrate obvious commitment to helping realize Gustavo’s dreams. And without a doubt, his leadership has been instrumental to achieving this success in such a short time!

Hy-Line International1755 West Lakes ParkwayWest Des Moines, Iowa 50266U.S.A.Phone: +1 515-225-6030Fax: +1 515-225-6425

Hy-Line UK InternationalLower Skilts FarmHenley RoadOuthill, StudleyWarwickshire, B80 7DUUnited KingdomPhone: +44 1527 850221Fax: +44 1527 851699

Email: info@hyline.comwww.hyline.com

Dr. Dennis Casey Research Farm Inauguration continued from pg. 1

The new research farm is an important project in Hy-Line International’s continued expansion plan. The Dr. Dennis Casey Research Farm has astate-of-art ventilation equipment, fire-proof insulated metal panel walls to minimize energy consumption, a manure-drying system, poultry-specific LED lighting, heated floors and a new computerized monitoring system. The farm is located on an isolated 160 acre site that includes both clean and dirty roads, an independent cleaning and disinfection station and many other measures to ensure a high level of biosecurity.

Dr. Neil O’Sullivan, Director of Research and Development, explains, “The investment in the Dr. Dennis Casey Research Farm affords Hy-Line scientists data to 90 weeks on all our lines to ensure accelerated rates of genetic progress in persistency of rate of lay and egg shell quality selections. Persistency of lay and egg shell quality show higher genetic variation at older ages so this information will help ensure continued genetic progress. The extended cycles also couple well with our genomics program allowing unique mating strategies to enhance genetic variation.”

Secretary Northey and Dr. Casey discussing the importance of the poultry industry in Iowa