Economic consequences of reproductive performanc ein dairy cattle

Henk Hogeveen, Chaidate Inchaisri and Niels Rutten

Changes over the years2

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009365

375

385

395

405

415

425

7500

7750

8000

8250

8500Calving interval (days) Milk production (kg/yr)

Jaar

Tuss

enka

lftijd

(dgn

)

Mel

k pr

oduc

tie (k

g/30

5 dg

n)

Problem ...... yeah but

I do not want to dry off my cows with 25 kg milk

I want less problems around transition

I have high productive, persistent cattle, so the damage is not too big

Well, a bit less milk .....

Is this right?

What can be influenced

Insemination decisions

Probability of conception ?

Probability of early-embryonic death ?

Oestrus detection

Detection/diagnosis reproductive disorders

Two decisions

When do I start inseminating

When do I stop inseminating

This presentation

Economic consequences long calving interval

Starting with inseminations

Stopping with inseminations

Heat detection (step counters)

Calving interval

Difficult calculations

Effect longer calving interval

●Less calves

●Lower production (kg/cow/day)

●More inseminations (?)

But also:

●Less costs around calving

●Less transition problems

●And how about persistence?

●Our solution: model calculations

8

Beware: Models ……. do not capture the complexity of the real situation

Beware: Models……. are sometimes nicer than reality (too good to be true)

Stochastic dynamic modelling

• Breed

• Parity

• Month of calving

• Milk production

• Farm level

• Relative performance

• Persistence

Cow

START OF CYCLE

12

Calf

Ovulation

Oestrusdetected

Insemination

Conception

yes

yes

yes

yes

no

no

no

no

cow

Probabilitiesbased on cow

factors

Quite complex

What are the values?

Costs lower milk production € 0.12 per kg (quota)

Returns calf: € 100

Costs calving (and transition): € 152

Costs inseminations: € 20

Just an estimation, it differs from farm to farm (of course)

Three different farms

Good Average Bad

Probability of ovulation (after 1st ) 1.00 0.95 0.90

Oestrus detection 0.70 0.50 0.30

Probability of conception 0.70 0.50 0.30

Incidence reproductive disorders (cyclicity) 0.03 0.07 0.11

Incidence repro disorders (conception) 0.20 0.27 0.33

Incidence embryonic death 0.05 0.07 0.09

Voluntary waiting period 9 12 15

Technical results

Good Average Bad

First insemination (wks) 10.5(9-13)

14.5(12-20)

21.7(15-35)

Calving interval (days) 362(342-408)

407(365-490)

507(394-670)

Ins. per cow 1.16(1-2)

1.61(1-4)

2.76(1-6)

Milk production (kg/cow/y) 8068(6329-9831)

7775(6188-9438)

7031(5441-8790)

Calves per cow pe ryear 1.02(0.90-1.08)

0.91(0.75-1.01)

0.74(0.55-0.93)

Not pregnant 0.00 0.00 0.21

Economic results related to good farm

Average Bad

Milk production 35 120

Calf sales 11 27

Not pregnant cows (culling) 0 128

Inseminations 5 20

Costs around calving -16 -42

Net total 34 231

Per day longer calving interval 0.57 0.70

Tool: www.wageningenur.nl/bec -> research -> decision support tools

Yeah but, selection space

This presentation

Economic consequences long calving interval

Starting with inseminations

Stopping with inseminations

Heat detection (step counters)

Decision one: starting with inseminations

Decision support difficult

Cow factors

●First ovulation

●Probability of oestrus detection

●Probability of conception

●Milk production

●Reproductive disorders

Economic factors

●Milk price

●Costs of insemination

●Costs of culling

●Costs of calving management

24

A complex system of interactions and

dynamics

What is the optimal voluntary waiting period

Dutch circumstances (not much seasonality)

We used to say: 60 days (as fast as possible)

Research:

●An optimal calving interval of 12 to 13 months is probably not applicable in all herds (Allore and Erb, 2000; van Amburge et al., 1997)

●Probably, the voluntary waiting period should be longer for herds with a high milk production and persistence (Abel et al., 2001; Sorensen and Østergaard, 2003)

Average performance

Voluntary waiting periods

6 wk 7 wk 9 wk 11 wk 13 wk 15 wkFirst insemination

10.9 11.5 13.1 14.8 16.8 18.5Calving interval

391 393 401 410 421 433MP/cow/year (kg)

8200 8188 8157 8112 8056 7997Inseminations perpregnancy 1.89 1.86 1.78 1.74 1.70 1.69Calves per cow per year 0.93 0.93 0.91 0.89 0.87 0.84

Not pregnanc (%) 0.018 0.019 0.021 0.025 0.030 0.037

26

Economic consequences (€/cow/year)

Voluntary waiting periods

7 wks 9 wks 11 wks 13 wks 15 wksMilk production

2.2 8.9 18.3 32.4 46.4

Calves 0.1 0.3 0.6 1.0 1.7

Culling 0.4 1.6 3.4 6.3 10.1

Inseminations -0.5 -1.6 -2.0 -2.8 -3.1

Calfmanagement

-0.1 -0.5 -1.0 -1.8 -2.9

Net total 2.1 8.6 19.0 34.2 52.2  (-16-22) (-11-32) (-6-53) (4-78) (13-106)

27

Average

0

10

20

30

40

50

60

6 7 8 9 10 11 12 13 14 15Wachttijd (weken)

Net

to v

erlie

s (€

/koe

/jaar

)

6 weeks not always optimal29

0

5

10

15

20

25

30

35

40

6 7 8 9 10 11 12 13 14 15

Per

cent

age

koei

en

Optimale VWP (wk)

Longer VWP when:

Cow factors

●Parity 1●Not HF●High persistency●Low production●Late production peak●Calved in winter●Bad oestrus detection●Delayed first ovulation●Reproductive disorders

Economische factoren

●Lower costs decreased milk production

●High costs insemination

●High costs culling

30

Summarizing

For 90% of the cows: optimal VWP <10 weeks

Optimal VWP differs from cow to cow

So no group management, but individual cow management (precision dairy farming)

31

Tool: h

ttp://w

ww

.wagenin

genur.n

l/bec/

This presentation

Economic consequences long calving interval

Starting with inseminations

Stopping with inseminations

Heat detection (step counters)

Question 2: When to stop

Difficult question (again)

Stopping = cullnig So: optimization Difficult model; probability of conception is dependent on:

●Parity●Lactation stage●Milk production●…….●Number of previous inseminations (more -> lower

probability) Models so far:

●Conception as constant (Groenendaal et al., 2004; Nielsen et al., 2010)

●Linear decreasing value per month (De Vries, 2006)●Marginal probility for different months (Houben et al.,

1994; Jalvingh et al., 1993)

Existing model (De Vries et al, 2006)

Three scenarios:

●I Constant probability of conception during lactation

●II Probability of conception dependent on months pp and parity

●III Probability of conception dependent on months pp, parity and previous inseminations

Input

Epidemiological research for Dutch cows (Inchaisri et al.,2011)

Literature, reports

Expertise

Probability of conception

Scen. Parity Months pp

3 4 5 6 7 8 9 10 11 ≥ 12

I 1 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42  2 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41  3 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41 0.41  4 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40  ≥ 5 0.38 0.38 0.38 0.38 0.38 0.38 0.38 0.38 0.38 0.38II 1 0.45 0.43 0.41 0.38 0.36 0.34 0.32 0.3 0.3 0.3  2 0.45 0.43 0.41 0.38 0.36 0.34 0.32 0.3 0.3 0.3  3 0.44 0.42 0.40 0.37 0.35 0.33 0.31 0.29 0.29 0.29  4 0.43 0.41 0.39 0.36 0.34 0.32 0.31 0.29 0.29 0.29  ≥ 5 0.41 0.39 0.37 0.34 0.33 0.31 0.29 0.27 0.27 0.27III 1 0.46 0.44 0.4 0.37 0.35 0.34 0.35 0.38 0.38 0.38  2 0.45 0.43 0.39 0.36 0.34 0.33 0.34 0.37 0.37 0.37  3 0.44 0.42 0.38 0.35 0.33 0.32 0.33 0.36 0.36 0.36  4 0.43 0.41 0.37 0.34 0.33 0.32 0.33 0.35 0.35 0.35  ≥ 5 0.42 0.40 0.36 0.34 0.32 0.31 0.32 0.34 0.34 0.34

38

Economic values

Value Source

Milk price, €/100 kg 34.46 Wageningen University (2010)

Calf price, €/calf 84 Wageningen University (2010)

Costs young stock raising, €/heifer 1540 Mohd-Nor et al. (2011)1

Returns culled cows €/kg life weight. 0.82 Wageningen University (2010)

Insemination, €/insemination 15 KWIN (2009)

Feed costs lactating cows, €/kg dm 0.11 Wageningen University (2010)

Feed costs dry cows, €/kg dm 0.07 Wageningen University (2010)

Variable labour, €/hour 11 KWIN (2009)

Fixed labour, €/cow/day 1.37 KWIN (2009)

Veterinarian, €/cow 100 Expertise

Other costs, €/cow/day 1 Expertise

Costs culling, €/cow 100 Expertise

39

Calculations

Retention pay-off (RPO)

● Discounted future returns when keeping a cow – discounted future

returns when culling the cow

● > 0: keep

Insemination value

● Discounted future returns when inseminating now – discounted

future returns waing

● > 0: now inseminating

Decision to stop with inseminating

● If RPO < 0 or

● Insemination value < 0

Results model

 Scenario

I II IIIMilk returns, €/cow/year 2951 2950 2947Total returns, €/ cow/year 3141 3147 3141Total costs, €/cow/year 2609 2627 2619Profit, €/cow/year 532 520 522Milk production, kg/cow/year 8564 8562 8553Interval calving-conception 120 115 117Pregancy % 24 24 24Yearly culling, % 23 24 24

41

Insemination values parity 1

42

-50

0

50

100

150

200

3 4 5 6 7 8 9 10 11 12 13 14 15 16Inse

min

ation

val

ue (€

)

Months in milk

Scenario I, 100% LV Scenario II, 100% LV Scenario III, 100% LV

Insemination values parity 1

43

-50

0

50

100

150

200

3 4 5 6 7 8 9 10 11 12 13 14 15 16Inse

min

ation

val

ue (€

)

Months in milk

Scenario I, 90% LV Scenario I, 100% LV Scenario I, 110% LVScenario II, 90% LV Scenario II, 100% LV Scenario II, 110% LVScenario III, 90% LV Scenario III, 100% LV Scenario III, 110% LV

Insemination values parity 2

44

-50

0

50

100

150

3 4 5 6 7 8 9 10 11 12 13 14 15 16

Inse

min

ation

val

ue (€

)

Months in milk

Scenario I, 100% LV Scenario II, 100% LV Scenario III, 100% LV

Insemination values parity 2

45

Insemination values parity 3

46

-50

0

50

100

150

3 4 5 6 7 8 9 10 11 12 13 14 15 16

Inse

min

ation

val

ue (€

)

Months in milk

Scenario I, 100% LV Scenario II, 100% LV Scenario III, 100% LV

Insemination values parity 3

47

Conclusions

Stop inseminating:

10-16 months pp (!!) -> max. calving interval ± 600 days

Heifers longer (16 months) then older cows (10 months)

Effect milk production: ± 3 months

48

Conclusions

Different scenarios:

Effects at cow level

Not at farm level

Effect of milk production and parity is much higher

49

This presentation

Economic consequences long calving interval

Starting with inseminations

Stopping with inseminations

Heat detection (step counters)

Automated oestrus detection

Sensor system

Sensor Metingen (data)

Detectie algoritme

Tocht alert

Sensor system

Activity sensor on collar

Performance

●Sens. ~62-90% Spec. ~>90%

Oestrus No oestrus

Alert Correct + False +

No Alert False - Correct -

Goal of the analysis

Activity sensors

Calving interval has economic consequences

Is automation profitable?

Herd of 130 dairy cows

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Simulation model

• Base on previous model

• Ovulation->detection->insemination

• Calving and culling

• Results (per farm per year):• Milk production • Feed intake• Inseminations• Calves• Culled cows

Culling rules

●Not pregant after 35 weeks of after 6 inseminations

●Random, dependant on age

●Rules (20%), random (80%)

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Two simulations

Visual SN 50%, SP 100% Sensor SN 80%, SP 95%

Labour

●Labour costs 18 €/hr

Task Time

Oestrus detection 10 min/day

Confirmation oestrus 5 min/alert

Checking alers 2.5 min/day

Investments

●Discount rate (intrest): 5%

●Depreciation 10 years

●Activity meters: 108 €/cow

●System: 3600 €/herd

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Cashflow (*1.000 €/farm/year)

Milk 330 334

Feed -128

-129

Calves

-7 -8

Inseminations

-7 -7

Culling

-7 -6

Labour

-1 -0.7

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Investment analysis

Cash flow(€/Year)

Internal rate of return (%)

Payback time (years)

Average 3,151 11% 7

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Effect of sensitivity (sn) and specificity (sp)

Titelstijl van model bewerken• Klik om de tekststijl van het model

te bewerken– Tweede niveau

• Derde niveau– Vierde niveau

» Vijfde niveau

Conclusions

• Investment in activity meters is cost effective

• IRR on average 11%

• Sensitivity important

Finally…..

Calving interval is costly

Costs prolonged calving interval are high -> room for improvement

Differences between farms

Early start of inseminations

●With exceptions (cow-specific management)

Long continuation with inseminations

●With exceptions

Improved oestrus dtection is valuable

65

Thank youFor yourattention