Agenda Item 1

Current situation: Market trends

Beef and veal consumption robust at around 300,000 tonnes each year

2006 2007 2008 2009 2010 2011 2012280

285

290

295

300

305

310

000 tonnes

Source: TNS/Kantar Worldpanel

Veal production has increased

2006 2007 2008 2009 2010 2011 20120.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Source: DEFRA

000 tonnes

Exports of beef and veal have increased since 2006

Source: GTIS

Imports somewhat level

Source: GTIS

Self-sufficiency in beef and veal

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

10

20

30

40

50

60

70

80

90

72

67 6668 68

7277 79 80 81

8488

85

Source: DEFRA

%

Agenda Item 2

Male dairy calves

Live exports at a low level

2006 2007 2008 2009 2010 2011 20120

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Head

Source : BCMS

Dutch farmers boycotted UK calf trade mid 2008 following detection of bTB

2012 - almost half to Spain

Spain

Ireland

France

Germany

Others

Source : BCMS

Dairy calf registrations since 2006 – male & female

Source : BCMS 2006 2007 2008 2009 2010 2011 20120

50

100

150

200

250

300

350

400

450

500

326 330 335

370 370 371388

411 407

435450

465 471 480

Use of sexed semen Apr 2011 – Mar 2012 (DairyCo survey of breeding companies )

Holstein Non-Holstein0

200

400

600

800

1000

1200

1400

1600

1800

2000 1836

28126531

Conventional

SexedNo. of se-

men straws ('000)

Destination of male calves (000’s)2006 2007 2008 2009 2010 2011 2012

Female Registrations 411.1 407.3 434.6 449.7 465.2 471.0 480.0

Male Registrations 326.3 330.1 335.1 370.3 370.3 371.4 398.1

Estimated no. males born * 411.1 407.3 430.3 440.9 451.6 452.9 457.1

Estimated no. disposed on-farm 84.8 77.2 95.2 70.6 81.4 81.5 59.0

Live exports 80.7 63.8 51.4 1.0 0.7 13.3 8.0

Estimated no. retained in GB 245.6 266.3 283.7 369.3 369.6 358.1 390.1

• From 2008 onwards, applying a 1% year on year increase in the number of heifers born due to the use of sexed semen

Destination of dairy male calves

2006 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% live exports% retained in GB% disposed on farm

Link between feed costs and registrations evident

2006

Q1

2006

Q2

2006

Q3

2006

Q4

2007

Q1

2007

Q2

2007

Q3

2007

Q4

2008

Q1

2008

Q2

2008

Q3

2008

Q4

2009

Q1

2009

Q2

2009

Q3

2009

Q4

2010

Q1

2010

Q2

2010

Q3

2010

Q4

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

120

140

160

180

200

220

240

260

40

50

60

70

80

90

100

110

120

130

£ per tonne 000 head

Rearing calf prices volatile since 2006 – but have moved up

Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep Oct

Nov

Dec Jan

Feb

Mar

2006 2007 2008 2009 2010 2011 2012 2013

0

20

40

60

80

100

120

140

160

£ per head

Source : AHDB/EBLEX

Ho/Fr heifers

Ho/Fr bulls

Upwards evolution in finished cattle prices continues

J F M A M J J A S O N D280290300310320330340350360370380390400410 GB R4L deadweight steer price

2013 20122011

Source: AHDB/EBLEX

p per kg dw

Evolution of compound cereal prices since 2006

2006

Q1

2006

Q2

2006

Q3

2006

Q4

2007

Q1

2007

Q2

2007

Q3

2007

Q4

2008

Q1

2008

Q2

2008

Q3

2008

Q4

2009

Q1

2009

Q2

2009

Q3

2009

Q4

2010

Q1

2010

Q2

2010

Q3

2010

Q4

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

100

120

140

160

180

200

220

240

260£ per tonne

Source : DEFRA

Dairy male calf registrations/beef and veal imports - a stable relationship

2007 2008 2009 2010 2011 2012200210220230240250260270280290300310320330340350360370380390400 Calf reg Imports

Source : BCMS/GTIS

000 head/000 tonnes

Economic prospects• Tighter global & domestic

supply will tend to support beef prices

• Margins possible for better quality animals

• Highly dependent on input prices

• Domestic market for veal still underdeveloped

• What value provenence ?

Financial performance (May-Apr)

2006 2007 2008 2009 2010 2011 20120.00

200.00

400.00

600.00

800.00

1000.00

1200.00

1400.00

Extensive Beef FinishingSource: AHDB/EBLEX estimates

Noncash costsOverheads (£)Variable costs (£)Stock purchases (£)Output (£)

Higher prices through 2011 and 2012 filtering through to improve returns, but still negative margin for many

2006 2007 2008 2009 2010 2011 20120

200

400

600

800

1000

1200

Intensive Beef FinishingSource: AHDB/EBLEX estimates

Noncash costsOverheads (£)Variable costs (£)Stock purchases (£)Output (£)

Agenda Item 3

Health and welfare of dairy calves

Dairy calf health and welfare

• Calf survival a continuing focus of attention – Perinatal mortality – Early stage nutrition – Control of disease

• Dearth of robust industry data• Specialist rearing units more

switched on to best practice ? • Outcome based welfare

measures for dairy cows

Colostrum (volume and quality)• Too much milk does not cause scour • Well fed calves develop higher immunity• 60% calves have inadequate colostral

immunity• Recommendation for 10% of body weight

in critical first 6hrs• £14/calf added cost feeding saleable milk• Reinforcement of strategies/best practice • Needs agreement on protocol from all

parties

Emerging results from DairyCo funded CASE studentship• Perinatal mortality

– Mean 5.4 % (Range 1% to 13.9%)• Differences in feeding regime for male calves

– Yes:34%, No:66%• Recorded examples, males given

– increased volume of milk to prepare for sale– waste milk, often in significant volume– milk powder, while heifers given fermented whole milk

• Proportion of bull calves disposed of on farm– 6.3%

Nutrition up to weaning

• A system based on feeding:– 10% of bodyweight

• (45 kg calf gets 4.5 litres)– 10% concentration of powder

• (4.5l @10% - 450 g powder) • Whereas feeding:

– 2.5 % of bodyweight• (45 kg calf @15% = 5.5l)

– 5% concentration of powder• (5.5 l @ 15% = 825 g powder)

Little more than maintenance

Maximum growth, when calf is biologically most efficient

Disease Risk/Effect on Yield

Calf health & welfare workshop• Royal Vet College, 23 July 2013

– DairyCo Research Partnership (Health, welfare & nutrition)• Aim to identify

– best practice guidelines for calf rearing– gaps to be addressed in current knowledge

• Four themes– health, welfare, housing and production economics

• Cross sector representation– Farmers, vets, researchers, legislators

Agenda Item 4

Developments in breeding

Reducing heifer losses

• Average heifers calving down at 28 months• Attrition rate of heifers during rearing period still

too high• Higher losses of dairy progeny from heifer calvings• Management during first lactation • Targetting better performance

– DairyCo PD+ blueprint – Benchmarking (e.g. Milkbench+)– PhD study: Economic analysis of heifer rearing and

breeding selection in UK

Current purebred genetic evaluations

• DairyCo provides evaluations for major dairy breeds • Pursuit of fitness traits tends to select for animals

with better conformation• UK genetic ranking encourages use of fitness traits

– Longevity, Fertility, Mastitis, Lameness• Genetic trends in all 4 areas are in a positive

direction• Since 2012, information available on farm’s herd

genetic reports• HUK introduced Body Condition Score indexes

Sire usage for combined fitness(Note; 2007 saw major change in £PLI)

Current PLI review likely further emphasise fitness traits, and include a Live weight component

Use of sexed semen• DairyCo survey of breeding companies indicate that

sexed semen accounted for 13% of sales in 2011/12• Resulting in approx. 5% skew towards female

progeny• Constraints to greater adoption of sexed semen

– Reduced conception rates– Less attractive to block calving systems– Lack of semen availability from elite bulls – Price ?

Cross breeding

• Since 2010, DairyCo also evaluates cross-bred animals

• Andy – some words on cross breeding and impact on calf price?

• Dairy systems modeling (Moorepark economic model)

Make it easier to choose semen

• Industry KT events on-going to educate farmers on use of the indexes on a pure and cross-breed basis

• DairyCo and Holstein UK both have websites that allow farmers to select the bulls that suits them

• Genomic selection

Extended lactations• Industry trend towards increasing lactation length • Modern genotypes can still be yielding significantly

beyond 305 days• Theoretical advantages of 18 (or 24 month) lactations

– Fewer progeny – reduced metabolic stress and increased longevity– insemination costs– reduced number of dry days within the cow's lifetime

Extended lactations

Evidence to date indicates• Feasible, but yield level and persistency of lactation are key• Different cows and sire groups react differently to delayed

breeding• Potential for cows to get too fat, compromising subsequent

lactations• Economics not sufficiently proven• Block calving systems more challenging, need 24 month

system• Further information needed to on interactive effects of

lactation pattern, diet and management before any wider recommendations

Development of Carcass EBV’s

• DairyCo/EBLEX funded study to evaluate potential of combining abattoir data with BCMS data

• Alternative approach in absence of beef progeny test• Feasibility study indicated

– Heritability estimates for net carcass weight, conformation & fat class: 0.31, 0.24, & 0.14

– Data challenges, registration• EBLEX in discussion with breed societies regarding

funding of potential implementation phase