How do I get her pregnant?

Labor

Vet Check

Semen

Hormones

MILK

Culls

Calves

Cost Revenue

Create a tool that allows “economic based” decision

making for selection of reproductive management

programs in dairy farms

Goal

• Difference between the present value of cash inflows and the present value of cash outflows for different survival curves

Net Present Value

NPVr,DIM = DEMV(P)DIM + DEMV(NP)DIM

Reproductive Performance

Days Open

Pregnant

Non-Pregnant

Available AI Pregnant

Period Open Period

VWP 50 0.00% 100.00% 100.00% 0.00%

Heat Bred 71 30.40% 69.60% 100.00% 80.00% 30.40% 49.60%

1st TAI 82 37.60% 62.40% 20.00% 20.00% 7.20% 12.80%

Heat Bred 103 48.96% 51.04% 62.40% 40.56% 11.36% 29.20%

2nd TAI 124 56.16% 43.84% 21.84% 21.84% 7.21% 14.63%

Ps = (P/AI)s * (SR)s

SRs = BEs * Bs

BEs = (1 – Ps-1)

NPs = 1 - ∑ Ps

Expected Monetary Value Pregnant Cows

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

$5.5

$5.7

$5.9

$6.1

$6.3

$6.5

$6.7

$6.9

$7.1

$7.3

50 70 90 110 130 150 170 190 210 230 250 270 290 310 330

Pe

rce

nt

Pre

gn

an

t (%

)

EM

V (

$/c

ow

/da

y)

Days Open

NPV for Repro Program

b c

d e

f g

h i

j

k

l

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 50 100 150 200 250 300 350 400

Pe

rce

nt

Pre

gnan

t (%

)

Days Open

$6.03/d 30.40%

Expected Monetary Value (a + b + c…)

Pregnant

Pregnant $1.81

-$1.57/d 69.60%

Non-Pregnant Expected Monetary Value (repro culls) +

Non-Pregnant

$-1.09

NPV for Repro Program

$1.81

$0.43

$0.70

$0.45

$0.50 $0.32

$0.35 $0.22

$0.24 $0.15 $0.17

$0.10

$0.25

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 50 100 150 200 250 300 350 400

Pe

rce

nt

Pre

gnan

t (%

)

Days open

$5.74/cow/d Pregnant NVP

Non-Pregnant NVP

EMV (a + b + c…) Pregnant

EMV (repro culls) + Non-Pregnant

NPV =

Data Inputs Case Study

General Productive and Economic Parameters

General Productive and Economic Parameters

Reproductive Program Selection

100% Heat Breeding program used as baseline

Hormone Injections and Heat Detection Labor Cost

Results

Breeding Costs

Reproductive Performance Survival Curve

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 50 100 150 200 250 300 350 400 450

Perc

en

t P

reg

nan

t (%

)

DIM

Current

Alternative

100% HD

Max DIM AI100% HD

100% TAI

$8.87

$9.03

$8.71

$8.50

$8.60

$8.70

$8.80

$8.90

$9.00

$9.10

NP

V (

$/c

ow

/day) Profit differences (NPV)

“per cow per day “ Current

Desired

100% HD

5. Net Present Value ($/cow/day) for Parity All

Economical Outcomes

Double-Ovsynch

Ovsynch

Double-Ovsynch

Ovsynch

Heat Breeding

Heat Breeding

Current-Alternative Current-100%HD Alternative-100%HD

NPV -$57,609 $56,817 $114,426

-$80,000

-$60,000

-$40,000

-$20,000

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

Do

llars

per

year

($)Profit differences (NPV)

“per herd per year “

Current vs. Alternative

-$57.000

Current vs. HD $56.800

Alternative vs. HD $114.000

Conclusions • Intended to compare different

reproductive programs within the same farm

• Evaluate NPV differences between programs rather than absolute values

• Great flexibility to accommodate numerous reproductive programs and productive scenarios

Final Remarks

• Breeding costs become trivial when compared to revenues realized by generating pregnancies

• Reproductive efficiency is the biggest driver of the economic outcome in the model

• All calculations are based on a single lactation

• Model does not account for pregnancy losses

• Assumes all breedings to estrus occur at a fixed interval

Limitations

Questions ? On the web: http://dairymgt.uwex.edu/tools.php#1

DEMV(P)DIM = ∑ δ (P)s(EMV(P)s – CSs)

where:

δ= daily discount rate

s = reproductive service

S = number of reproductive services within defined DIM

EMV(P) = expected monetary value for cows becoming pregnant

CS = Cost of reproductive service

Discounted Expected Monetary Value

CSs,r = HOR + LAB + AI + PD

where:

CS = total breeding cost

HOR = hormones required for synchronization ($/service)

LAB = labor required to administer hormones

injections ($/cow/day)

AI = cost of insemination (includes semen and

labor; $/service)

PD = pregnancy diagnosis ($/cow/service)

Breeding Cost

Discounted Expected Monetary Value

DEMV(NP)DIM = δ(NPs)[EMV(NPs)+(SV+MVC–HRV)/(DIM)]

where:

δ= daily discount rate

EMV(NP) = expected monetary value for cows not becoming pregnant

SV = salvage value of a cow

MVC = market value of a calf (weighted average of male and female

offspring)

HRV = heifer replacement value

Expected Monetary Value

EMV(P)s = (MPV(P)+VNB-CFM(P)-CFD-CC(P)-CD(P))s

EMV(NP)s = (MPV(NP)-CFM(NP)-CC(NP)-CD(NP))s

where:

MPV = milk production value ($/d)

VNB = value of a new born of pregnant cow ($/d)

CFM = cost of feed for milking cows ($/d)

CFD = cost of feed for dry cows ($/d)

CC = cost associated with involuntary culling ($/d)

CD = cost associated with unexpected death ($/d)

NPV for Repro Program

b c

d e

f g

h i

j

k

l

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 50 100 150 200 250 300 350 400

Pe

rce

nt

Pre

gnan

t (%

)

Days Open

$6.03/d 30.40%

Pregnant

$1.81