A new independent study measuring the financial performance of
dairy herds has revealed stark differences between low and high
genetic merit herds.
The difference in margin between a herd of average genetic merit
(Profitable Lifetime Index 14), and a herd in the top 1% (PLI
75) has been shown to be, on average, £286 per cow per
year, equating to a staggering £28,600 annually for a 100
cow herd. In other words, one point of PLI is worth over £4.50/cow/year.
The study has used completely independent genetic data from
DairyCo breeding+ and fully bank-reconciled figures from herds
using Promar Farm Business Accounts service. It involved over
20,000 Holstein cows in herds averaging around 7,500 litres,
and is the first study of its kind to be undertaken for over
“In arriving at a margin, we have considered all identifiable
income and costs which are likely to vary in herds of different
genetic merit,” says Tim Harper from Promar, who undertook
the study. “This includes milk, calf and cull sales and
the costs of all feed, herd replacements, vet and med, AI and
“Assuming there is no relationship between genetics and
any other costs, the margin will translate directly through to
Commenting on the findings, DairyCo breeding+ director, Marco
Winters says: “Of course it’s no surprise to us that
the highest genetic merit cows are the most profitable. After
all, this is precisely what genetic indexes in general and PLI
in particular have been designed to identify.
“But it is important to check what is happening in practice
from time to time, and the results of this study are extremely
reassuring. We expected several of the costs to be higher for
the high PLI animals, including those for feed, herd replacements,
veterinary and semen, and this has been shown to be the case.
But the extra income generated by the high PLI animals from milk
sales per individual cow in the herd is overwhelming, and more
than compensates for the extra costs of keeping that cow.
“Of course, we’re not suggesting that good breeding
is the only factor in determining the profitability of these
herds,” he adds, “but it clearly has a very important
influence. It is equally reassuring to find that its influence
has been demonstrated over a cross-section of the herd types
which use these Promar costings.
“The resounding message is that good quality genetics
are helping to keep the most profitable farmers ahead. It’s
definitely worth all producers taking note of these results and
investing in PLI as part of a package of measures to improve
their financial performance.
“A further challenge must be to find the right balance
in continuing to improve the genetic merit of the national dairy
herd while reducing the additional costs of keeping higher genetic
merit cows,” he adds. “The new PLI itself will do
much to help in this endeavour, with its far greater emphasis
on health and fitness traits than was ever the case in the past.”
Observing that the study was undertaken using Promar’s
Farm Business Accounts for the year ending in 2006, Tim Harper
concludes: “Since there have been significant changes to
the economics of milk production since that time, these will
have an impact on the relationships. We would expect the link
between PLI and profitability to be even greater in the current
economic climate, further strengthening this important message.”
Dairy farmers who would like to know how their own herd compares
with the national average for PLI can obtain a Herd Genetic Report
from DairyCo breeding+. To register for a free copy for your
herd, please call DairyCo on 01285 646500 or visit www.dairyco.org.uk.
UK Milk Production at 37 Year Low
New Mobility Monitor On Offer from NMR
Legato Life Pulsators offer Savings for Dairy Farmers