Beef embryo transplants might offer more profit potential than dairy/beef crossbreds for dairy herds that don’t need all their cows to produce dairy replacements.
To that end, Select Sires is now dipping its toe into the beef embryo market, offering Simplot’s SimVitro HerdFlex beef transplants.
The use of transplants could add $100 per calf in potential profit over Holstein/beef crossbreds, says Larry Corah, a Kansas State emeritus professor specializing in beef production and a supply chain consultant for Select Sires. He says beef transplants carried by Jerseys could offer an even greater value difference.
Corah’s economic assessment is based on straight-bred beef calves’ better rate of gain and feed efficiency, better carcass weight and better grade at harvest.
While dairy farmers have seen a premium paid for dairy/beef crossbreds, those premiums are shrinking as cattle feeders and packers have gotten more experience with the crossbreds. The problem is that the crossbreds typically have lower rates of gain, poorer feed efficiency and finish at higher weights than beef cattle. The large crossbred carcasses can also create problems at the packer. Plus, they tend to grade lower than straight-bred beef cattle.
Using beef transplants can solve those problems. Plus, dairy cows freshen year-round, so beef from dairy herds would offer a year-round supply rather than the seasonal surge coming from beef herds.
Minnesota/Select Sires began commercial trials with beef transplants on five commercial Minnesota dairy farms last June. The trial compared implanting beef embryos with breeding cows with beef semen. They implanted 398 beef transplants and achieved 146 pregnancies, for a 36.7 percent conception rate. A total of 2,608 units of beef semen were also used, achieving 971 pregnancies, for a 37.2 percent conception rate.
Of the transplants, 228 of the embryos were transplanted June to September, with 91 pregnancies achieved. The conception rate was 39.9 percent. Breeding with beef semen during this period achieved a 34 percent conception rate. While there are not enough numbers in the study to reach statistical significance, Chris Sigurdson, Minnesota/Select
Sires general manager says the numbers make sense biologically. That is because high-grade embryos implanted a week after standing heat typically don’t have the same loss as naturally fertilized eggs the first week after insemination during heat stress.
Producing in vitro embryos has its own cost, but Simplot has now commercialized the process to the point where it is now becoming economically viable. Black, beef females from known Western beef herds are taken to a slaughter plant where oocytes are recovered. There, the oocytes are harvested and fertilized in vitro. Semen comes from Select
Sire bulls ranking in the upper quadrant for $Beef, which is an index similar to Net Merit $. The $Beef index includes calving ease, weaning and yearling weight, dry matter intake and carcass weight, marbling, ribeye area and fat.
Of the first 10 HerdFlex calves born on New Heights Dairy near Rice, Minn., born in March and April of this year, all but 2 scored premium on the Igenity Terminal Index (TI) genomic test. The group averaged 7.2 TI. Anything above 6.6 is considered premium and represents the top 25 percent of the breed.
New Heights Dairy, co-owned by Brent Czech, his wife and parents, milks 3,300 cows on two sites and has about 100 pregnancies to beef embryos. About a third of those have calved in.
The Czechs are breeding about 40 percent of their cows to beef. They are trying embryos to increase the value of those pregnancies they don’t need for dairy replacements.
“We’re still determining what the best strategy will be,” says Brent. “I am working on coming up with a plan that maximizes value and fits with our production model.”
The embryos are currently priced at $55 each. It takes about 2.4 embryos to achieve pregnancy, so the cost per calf comes to about $132. Minnesota Select Sires is also charging $8 per implant, bringing the total cost to about $150. However, embryo transfer training for a farm’s A.I. technician is available with a minimum contract for embryos.
Keep in mind, there is also a cost to using beef semen if you were breeding dairy/beef crosses. Select estimates the net cost to use embryos would be about $120 per live calf.
Since the market for these calves has not been established, it’s difficult to project bottom line profit. Corah’s estimate of a $100/head profit is conservative, believes Sigurdson.
A lot of it will depend on how far the dairy wants to take the calf. The most profit potential lies in taking the animal through slaughter.
“We feel these calves will be worth $300 to $350 wet with an upside to that in the spring, which is historically the highest price paid for beef calves,” Sigurdson says.
“We have a large central Minnesota feeder wanting to contract with dairies and initially suggested paying $2/lb weaned at 60 days subject to market conditions,” he says. New Heights Dairy weaning weight average is 225 lb.
The best prices and premiums will come for dairies which can produce trailer loads of 20 to 40 of these calves each week or two. That provides cattle feeders a consistent, uniform group of calves.
Brent Czech is hopeful about the possibilities of beef embryos providing more value for dairy farmers. “As more people learn what can be done with IVF embryos, it will create more unique marketing opportunities for dairy producers,” he says.
For more information on SimVitro HerdFlex beef embryos, click here.