The economic returns from breeding are unique because the genetic gains are permanent and cumulative, and as New Zealand grazing herds have found, efficiency and profitability can both be achieved with a long-term approach focused on the right objectives and performance indicators. While genetics can deliver greater efficiency and profitability, they are only part of the equation. For animals to express their genetic potential to the fullest, the right environment needs to be created.

As such, genetics are one of the tools in the farmer’s toolbox. This tool is, however, permanent and cumulative; once it’s there and you look after it, the rewards can be enjoyed continuously.

There are two ways to improve profitability in a pasture-based system: increase the net income per unit of feed consumed, or increase the number of units of feed or scale of the operation. Genetic improvement of dairy cows can help with the first part but requires the right performance indicators, the right breeding objective (focus) and a long-term approach.

In New Zealand, for example, farm production is usually described in kilograms of milk solids per hectare rather than in kilograms per cow. Milk solids are defined as the sum of fat and protein yield. For a pasture-based system, production per hectare is the relevant performance indicator rather than production per cow.

The right breeding objective incorporates the traits most relevant to production efficiency and utilizes the right economics to value these traits. Production efficiency in a pasture-based system is all about efficient conversion of grass into quality milk. Efficiency implies that we don’t just focus on growing output, but we also look at input. In other words, more production per unit of feed consumed.


This requires inclusion of the feed costs associated with production, growth and maintenance, as well as the usual milk revenues, beef revenues and costs per cow.

The concept of including feed costs associated with maintenance was suggested in 1970 with the argument that including estimated energy intake in the selection objective would dampen the enthusiasm for the larger cow per se and thereby reduce costs associated with cow maintenance.

Furthermore, in 1994 it was noted that exclusion of other major components of net income such as feed requirements for maintenance can favor higher-producing larger cattle over comparatively lower-producing, smaller cattle, even if the smaller cattle were more economically efficient. In other words, bigger is not always better.

Selection on longevity and fertility will not help with output but will help with the inputs and the cost side. Longer-lasting cows will result in the need for fewer replacements and lower direct rearing costs. Another way to look at this is to aim for higher lifetime production.

Fewer replacements will also allow a larger part of the homegrown feed to be utilized for milk production, resulting in more output from the same scale of operation. Increasing cow fertility will result in more productive days, more replacements from A.I., lower A.I. costs and longer-lasting cows. Improving both will help to produce more with less again, thus improving efficiency.

Sire selection is the key to herd improvement. The right breeding objective will lead you to the right sires and result in a higher return on investment from your genetics. With the same money spent you will achieve more, and that too is efficiency.

Another part of this is matching the genetics you use with your farming system. If you run a typical U.S. system, using the U.S. breeding values and indexes is the logical thing to do.

However, when you are running a pasture-based system that mimics New Zealand much more than the average U.S. system, paying attention to breeding values and rankings from this country adds value. Utilizing genetics proven under your particular system will improve the performance and will add to efficiency.

What concepts from overseas can we apply to breeding programs in the U.S.?
Conversion efficiency versus output efficiency

The introduction of a genetic evaluation for live weight for both cows and sires in New Zealand was a necessary feature for economic efficiency comparison between animals of different breeds (Friesian and Jersey) that differ markedly in live weight.

Inclusion of the breeding value for live weight in the National Breeding Objective enabled New Zealand to improve the genetic trend for production (kilograms of solids production) while decreasing the genetic trend, while still positive, for live weight.

The change in the average milk production yield and live weight over the last 10 years indicates that the average feed intake has increased by 9 percent, and the partitioning of dry matter to milk production relative to maintenance has increased from 56 percent to 59 percent. This increase in economic efficiency resulted in more production per unit of feed.

This increased focus on solids production per kilogram of live weight meant New Zealand farmers started crossbreeding intensively using the Friesian and Jersey populations. However, breeding values for animals of different breeds are usually not presented on the same base.

This makes economic efficiency comparisons difficult. By putting all bulls and cows on an across-breed genetic evaluation system, this problem was solved.

Animals are ranked independent of breed, and anyone striving for the most economical animal independent of breed or wanting to find the best bulls to crossbreed with can do so. This system results in many farmers making decisions based on economics rather than emotion and allows for pasture-to-grass efficiency to be maximized. PD

Peter van Elzakker is CRV global product manager – grazing, New Zealand.

References omitted due to space but are available upon request. Click here to email an editor.