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