From the Dairy Route Letter Nov 2014
The latest big idea from the technology breeding sector
Sexing Technologies of Nagadoches TX controls the patent for producing
They purchased Trans World Genetics
(stud 151, Wisconsin) five years ago, in order to access export AI markets for
sexed semen, and purchased Taurus Service (stud 76, Pennsylvania) this summer,
the result of a desire to raise the profile of their Genomic acquisitions by
having both USA and international sales.
Thus the new “Taurus ST” logo and
semen product offering combines three separate programs into one.
Sexing Technologies announced a new “Sexed Ultra”
product at World Dairy Expo.
Over the past five years, once acquiring TWG gave them
access to markets to test semen straws in real world conditions, the goal of ST
has been to improve the conception rates on sexed semen. They have shortened the time it takes to
separate the sperm cells by 75%, made some energy modifications to the semen
extenders used, increased the sperm concentration per straw by a million. The resulting “Ultra” product in a 12,000
cow trial in Germany this summer produced conception rates for the “Sexed
Ultra” product equal to the conception rates of conventional European AI semen
(at the same sperm count).
The new sales manager for Sexing Technologies (which
offers semen—both “sexed” and conventional, high Genomic embryos, and live
cattle for export) described their new view of a progressive dairy herd
breeding program as follows:
Genomic test all your cows, to help
determine who are your “best” breeding cows currently.
Breed the “top half” of those cows to
female “Sexed Ultra” dairy semen for your future replacements.
Breed the “bottom half” of cows to male
“Sexed Ultra” beef semen for premium market steer calves.
ST is not the only company to advocate this—a large scale
Limousin cattle company in Nebraska has been promoting breeding Limousin
bulls to the bottom half of Jersey herds, contracting to buy all the
beef breed calves for their feedlot system.
Jersey dairymen in western states who are a distance from population
centers (getting next to nothing for deacon bull calves) have found this
attractive as the beef prices have escalated and crossbred beef calves have
earned market premiums. They just switched
to female sexed semen to insure enough dairy replacements from “better” cows.
Does this pencil out the way it is promoted?
Most of you are probably already enjoying higher
cull cow and deacon calf salvage value which is a result of the run-up
in corn prices for 2010, 2011 and 2012 combined with a couple tougher winters
resulting in a big reduction in the beef cow-calf herd numbers. Dairy cull beef and dairy steer calves
have been required to take up the slack in the market beef supply, which in the
last year finally caught on to the shortage of supply in the feedlots. For a couple years now, the value of an
open dairy heifer “by the pound” equaled or exceeded their value for future
dairy replacements. The western USA
facing losing battles over access to water sent most of its heifers to Midwest
Thus in fact, many of you are already
using strategies that are keeping lower profit cows moving out of dairy herds
into the beef supply chain. For the
first time in decades, you can buy a good replacement for the sale value of two
culls. On the calf side, relatively
low prices for corn have encouraged feedlot operators (who ran below capacity
for two years of unprofitable corn costs) to fill their yards again, and are
again buying animals at younger ages to insure supply for the entire corn
Thus, the prognosis is—as long as corn
feels “cheap” to feedlot operators, they will be buying cattle.
Compare the costs of using conventional vs sexed semen
[average size] herds not using sexed semen the numbers could look
100 milking cows, 25% cull rate, 45% heifer calves
expected from all AI matings.
Total semen budget for the year might add up to $3937.50:
75 cows rebred each year, x 2.5
services per cow average, @ $15 per straw average = $2812.50.
50 heifers bred each year, x 1.5
services per heifer, @ $15 semen cost = $1125.00
Average stillbirth rates are 8% on
cows, 13% on heifers, according to DHIA data across the USA.
You harvest 31 heifers from 75 milking
cows, you harvest another 19 heifers from heifers.
You would likely have (37 + 23)
60 live deacon bull calves
to sell each year.
A 25% annual culling rate implies an
average four lactation life for each milking cow. While USA average is only three lactations
per cow, I like to suggest that dairymen who follow our program will see this
change (mating by aAa + screening bulls for maternal longevity + selection on
PL) and the effect is a lowering of cow replacement costs by 33% alongside a
noticeable improvement in fertility.
Overhead per cow to produce milk = $2400
average cow market price of a first lactation replacement
(two lactations = $1200 per year) (three lactations = $ 800 per year) (four lactations = $500 per year)
Cashflow from milk: add up your most recent year’s milk checks. Maybe $350,000 ($3500/ cow)
Subtract feed costs of 55% ($1925/ cow) and
you have a gross income before operating costs that is $1575 per cow. Two lactations nets $375: Three lactations
nets $775: Four lactations nets $1425.
This is the real reason why longevity
in cows can produce more profit gains than increased milk.
Cashflow from cull beef: currently we see prices to which most of us
25 cows @ $1250 = $ 31,250 from cull
cows: 60 bull calves @ $200 = $ 12,000
Cashflow from surplus cows (50 heifers raised, 25
needed): 25 replacements @ $2400 = $60,000.
Conventional semen is one half to one quarter the cost of
the same bull in “sexed” form.
Thus in herds using sexed semen, its use has been limited to heifers
(43% of herd matings, 30% of AI services).
At this level of usage, a 100 cow herd
(with “normal” 33% cull rate) might be spending $5400:
67 cows rebred x 3.0 services @ $12
per straw = $2400. + 50 heifers x 2.0 services @ $30 = $3000.
These matings we would expect to
produce 68 live heifers:
67 cows @ 45% females @ 8% stillbirths
= 28. 50 heifers @ 90% females @ 10%
stillbirths = 40.
Thus there would likely be (33 live
from cows) + (4 live from heifers) 37 salable deacon calves.
Note the use of sexed
semen on heifers within two years could increase the supply of heifers from 50%
of the milking herd numbers to 68% (68 to breed compared to 50) as it also
decreases the numbers of deacon bull calves to sell. At that point, with more heifers to breed,
you not only buy more semen, you buy a higher percentage of sexed semen: $6480:
67 cows rebred x 3.0 services @ $12 per straw = $2400.
+ 68 heifers x 2.0 services @ $30 =
Breeding “the bottom half” to beef
bulls and selling the calves obviously solves a problem that added heifer
numbers will quickly create. Of
course, a Genomic test costs an added $50 per cow if you buy the idea that the
technology is always right. Add (33
new cows x $50 G test = $1650 to
the annual costs of breeding. Sexed
beef costs the same as sexed dairy.
BUT all you need is four lactation “longevity”to generate an
added $60,000 to cash flow without any sexed semen. So think about it