Optimal utilization of modern reproductive technologies to maximize the gross margin of milk production

Economic analysis of the use of in vitro produced embryos transferred during heat stress under dairy herd constraints

The use of embryo transfer helps to improve reproductive performance during periods of heat stress. In vitro produced embryo transfer (IVP-ET) is more expensive than artificial insemination. We hypothesized that the value IVP-ET in seasonal herds depends on herd constraints, such as the maximum number of milking cows and the maximum number of calvings that can be accommodated throughout the year. Therefore, the objective of this study was to estimate how profitability in dairy herds exposed to summer heat stress is affected by the number of months in which IVP-ET is used, the use of IVP-ET in repeat-breeder cows, IVP-ET cost, and herd constraints. We built and used a nonlinear programming model of a dairy herd with young stock and cows with monthly Markov Chain transitions. The model varied the number of heifers calving in each calendar month to maximize herd profitability. We varied IVP-ET cost ($100 or $200), duration of the IVP-ET program (2 or 4 months), and the breeding number in which IVP-ET started (1st or 3rd). In total, 20 scenarios were simulated. Maximum profitability was obtained when IVP-ET was not used, regardless of herd constraints. The 16 scenarios in which IVP-ET was used showed increased seasonality in milk yield, numbers of milking cows, total cows, total calvings, and heifer calvings because the program tried to limit the number of IVP-ET breedings in the summer. The addition of the calving constraint increased the value of IVP-ET. The breakeven cost per IVP-ET ranged from -$6.79 to $24.38 compared with conventional semen cost of $20. In conclusion, the current market costs of IVP-ET did not warrant application with the objective to increase reproductive performance during heat stress. Herd constraints on the maximum allowable seasonality in the monthly number of milking cows and calvings affected the value of IVP-ET during heat stress.

Bioeconomics of sexed semen utilization in a high-producing Holstein-Friesian dairy herd

A bioeconomic, stochastic spreadsheet model, that included calculation of the net present value of the additional value of all future descendants resulting from increased selection intensity, was developed to study the profitability of using sexed semen in a high input-high output dairy herd. Three management strategies were modeled: (1) only heifers inseminated with sex-sorted semen and cows inseminated with unsorted semen; (2) both heifers and cows inseminated with sex-sorted semen; and (3) a reference scenario, in which all breeding females were inseminated with unsorted semen. A Monte Carlo simulation (@risk software, Palisade Corp., Ithaca, NY) was run to study the sensitivity of net profit and sexed semen advantage to key input parameters. Most input parameters were given truncated normal distributions, whereas the maximum numbers of inseminations in heifers and cows were given discrete distribution functions. The calculated intensity of selection accounted for the different numbers of dairy females born for each of the 100,000 iterations. Using sexed semen (X-sorted, female) was shown to be profitable, with insemination of both heifers and cows being most profitable. The returns on assets were higher when only heifers were inseminated with sexed semen (8.54% ± 2.94; ±SD) or all females were inseminated with sexed semen (8.85% ± 2.93) than when all females were inseminated with unsexed semen (8.38% ± 2.95). The range in net profit was most sensitive to the assumed distributions of milk protein price (€/kg), milk fat price (€/kg), cow pregnancy rate, fertilizer price (€/t), and concentrate price (€/t) when unsorted semen was used. When only heifers or both heifers and cows were inseminated with sex-sorted semen, the range in net profit was most sensitive to the same distributions, with fertilizer price and cow pregnancy rate in reverse order of sensitivity. However, the range in sex-sorted semen advantage (in net profit) when only heifers were inseminated with sex-sorted semen was most sensitive to the assumed distributions of cow pregnancy rate, sex-sorted semen pregnancy rate as a percent of unsorted semen rates, standard deviation of index, additional cost of sex-sorted semen (€/dose), dairy bull calf price (€/head), and dairy heifer calf price (€/head). When both heifers and cows were inseminated, the order of importance of the last 2 inputs was reversed. This study highlights the relatively high effect of pregnancy rate and the genetic value of dairy bulls in determining the level of financial advantage from using sex-sorted semen in a dairy herd.

Economic and genetic performance of various combinations of in vitro-produced embryo transfers and artificial insemination in a dairy herd

The objective of this study was to find the optimal proportions of pregnancies from an in vitro-produced embryo transfer (IVP-ET) system and artificial insemination (AI) so that profitability is maximized over a range of prices for embryos and surplus dairy heifer calves. An existing stochastic, dynamic dairy model with genetic merits of 12 traits was adapted for scenarios where 0 to 100% of the eligible females in the herd were impregnated, in increments of 10%, using IVP-ET (ET0 to ET100, 11 scenarios). Oocytes were collected from the top donors selected for the trait lifetime net merit (NM$) and fertilized with sexed semen to produce IVP embryos. Due to their greater conception rates, first ranked were eligible heifer recipients based on lowest number of unsuccessful inseminations or embryo transfers, and then on age. Next, eligible cow recipients were ranked based on the greatest average estimated breeding values (EBV) of the traits cow conception rate and daughter pregnancy rate. Animals that were not recipients of IVP embryos received conventional semen through AI, except that the top 50% of heifers ranked for EBV of NM$ were inseminated with sexed semen for the first 2 AI. The economically optimal proportions of IVP-ET were determined using sensitivity analysis performed for 24 price sets involving 6 different selling prices of surplus dairy heifer calves at approximately 105 d of age and 4 different prices of IVP embryos. The model was run for 15 yr after the start of the IVP-ET program for each scenario. The mean ± standard error of true breeding values of NM$ of all cows in the herd in yr 15 was greater by $603 ± 2 per cow per year for ET100 when compared with ET0. The optimal proportion of IVP-ET ranged from ET100 (for surplus dairy heifer calves sold for ≥$300 along with an additional premium based on their EBV of NM$ and a ≤$100 embryo price) to as low as ET0 (surplus dairy heifer calves sold at $300 with a $200 embryo price). For the default assumptions, the profit/cow in yr 15 was greater by $337, $215, $116, and $69 compared with ET0 when embryo prices were $50, $100, $150, and $200. The optimal use of IVP-ET was 100, 100, 62, and 36% of all breedings for these embryo prices, respectively. At the input price of $165 for an IVP embryo, the difference in the net present value of yr 15 profit between ET40 (optimal scenario) and ET0 was $33 per cow. In conclusion, some use of IVP-ET was profitable for a wide range of IVP-ET prices and values of surplus dairy heifer calves.