One of the mysteries of the beef industry is how a commercial breeder decides the value of a bull at purchase time.
Old-timers worked on the basis that the value of a bull was equal to a rail truck load of prime bullocks. This theory doesn’t work so well anymore. Bullocks aren’t trucked by rail anymore partly because bullocks aren’t produced much these days and if they were, then the railways don’t run much these days anyway. Furthermore, how many bullocks you fitted in the rail truck, that is if both bullocks and rail trucks were available, depended in what state you loaded them.
Clearly, we need a better method to calculate how much a bull is worth paying. Firstly, we need to focus attention on how much a bull is worth, rather than how much the bull may cost – there can be a difference of considerable magnitude if you don’t get it right.
The time-honored method of buying bulls is much like buying cars. Walk around it a few times, kick the hubcaps to show you really know what the jobs are all about, and then try and beat the dealer. At least when buying cars, you were in a position to know the performance of the car and match that performance profile with your needs.
Buying bulls using visual assessment alone has proven to be a fallible skill. If you don’t clearly know what it is that he has to improve, fix or hold steady in your herd, let alone whether or not he has the genetics to do those things, then it becomes an even greater game of chance. In the early days of Breedplan, the opportunity arose to analyze the objective performance of progeny from bulls that had been purchased into the herd without the benefit of objective information themselves.
The results were surprisingly consistent across all the herds analyzed… Big herds or small herds, high profile breeders or low profile breeders, the outcome was depressingly similar. For every four bulls that had been purchased, only one of those four bulls had made a positive contribution to his progeny for the target traits, two of the four bulls maintained the status quo, and one of the four bulls had a negative impact. The end result was that virtually no progress was being made, and you had a one in four chance of getting it right.
Next time you visit a surgeon, who happens to be a cattle breeder and buys a few bulls, ask him are his surgical skills better than his bull buying skills because you are not prepared to accept a 1:4 chance of him getting it right your time round! Of course, we know that surgeons give you better odds than 1:4…
The question is why? One surgeon who was asked to better the odds gave the classic answer. “I have been trained to be a surgeon, I use the latest techniques and update my skills regularly, I get feedback (performance audits) from my clients and insurer, and am accountable to a higher authority if I get it wrong. I haven’t really been trained to be a bull buyer”. How do we become better bull buyers and get better value for money when buying bulls?
The answer is fairly straightforward. We need to value a bull on the same basis we value a parcel of land, a new tractor, or an investment in stocks and shares. That is, return on investment. There are two dimensions to the value of a bull. The first dimension is his salvage value – what you own at the fall of the hammer, regardless of the price paid. That is, some 800kg of bull beef, which whilst he keeps breathing is worth about $1 per kg. Your $5000 purchase is worth around $800 to you as he stands before you. Given objective information such as the actual weight of the bull and the schedule price for bull beef, you can fine-tune the estimate of his “point of sale” value.
He might in fact be worth$780 or maybe $830, but the difference won’t really get the bank manager off your back. The second dimension to the value of a bull is his breeding value – what he will earn you, through the performance of his progeny. How much extra above salvage value is a function of how better his breeding value for the traits that you need to improve are compared to another bull.
Clearly, we don’t know the breeding value of a bull that hasn’t yet bred any progeny, so we need to estimate his breeding value. It is no accident that the term used by Breedplan, the EBV, is an abbreviation for Estimated Breeding Value. How can we estimate a bull’s breeding value, with accuracy?
Firstly we need to define what it is that will earn us the dollars, then convert that information into genetic values with which we can make selection decisions. The breeding value of a bull will be reflected in several ways. Firstly, the number of progeny that he will sire during his useful life span.
The more progeny born, the more calves to sell and the lower the bull cost/calf. This is a combination of fertility, largely a function of semen quality, serving ability, largely a function of structural soundness and mobility, and calving ease, a function of birth weight and conformation. We can objectively assess all of these functional traits.
Semen-producing ability can be simply evaluated in the field by palpating and measuring the circumference of the scrotum. Research has shown that avoiding bulls with soft testicles and/or bulls with a scrotal circumference of less than 32 cm significantly reduces your chance of buying a bull of low semen-producing ability.
To go a step further, bulls can be semen tested, but this is generally not considered a cost-effective proposition for young, healthy bulls that have been screened for testicular soundness. The chance of buying a poor serving bull, or one that is prone to break down at an early age, can be reduced by skilled soundness evaluation, giving particular attention to hind leg structure and straightness, mobility, and feet score.
To be surer, serving ability can also be objectively assessed by the “Blockey” serving capacity test, which has been shown to have a high correlation between test results and actual paddock performance. Having assured ourselves that the bull is functionally sound and will produce lots of calves, the next aspect of assessing the breeding value of a bull is to estimate the relative value of those progeny.
The driving traits here are growth rate, giving us the number of kgs available for sale, and the value per kg, today, more and more becoming a function of meat yield and quality parameters. Next, we need to account for the value of the bull’s daughters as replacement breeders for the herd.
Maternal traits such as milk, weaning weight, calving interval, gestation length, and calving ease are important. Now we have a fairly large shopping list and the chance of finding a bull that excels at all those traits is small, and by now is most likely out of your price bracket. Compromise now becomes the great leveler.
We need to prioritize traits in order of importance. To do this, you need to know where the production of your herd is falling short of industry benchmarks and market specifications. You need feedback and more feedback, and then some more feedback, something that has been seriously lacking in the Australian beef industry, and the reason why the industry has progressed so slowly in improving carcass quality.
Given useful feedback, you can quickly see the relative value for increasing selection pressure for growth, say as compared to muscling or milk. Without feedback, bull selection has little direction and is reflected in the 1:4 outcome previously mentioned.
Now comes the hard part, estimating the breeding value of a particular bull for the traits that are deemed important. Again, we need information. If, selection decisions are based on differences between individuals, the more we know about those differences, the better off will be our decision-making. A problem emerges. Not all differences that are observed between bulls are inherited by the progeny. Some of the difference is heritable and is the part that is passed on, and some of the difference (usually the larger part) reflects the influence of nutrition or management practices and is inherited by the progeny.
We need to know how different the progeny will perform, not how different the bulls look! To estimate the breeding value, we have two options. The first option is to rely on visual assessment, and as already discussed, this is a fallible skill. The other option is to measure real differences by removing environmental influences, adjusting for differences in age and age of dam, and then scaling the result to reflect the heritability of the difference, (some 20-30% for growth traits, around 10% for milk and about 30-40 for most carcass traits).
By now you have just about run out of puff – too many things to consider, too many unknowns to account for. Or you could look at the Breedplan EBVs for the bull. EBVs is an abbreviation for Estimated Breeding Value. EBVs are calculated from objective performance information measured on the individual as well as his relatives.
This information is adjusted for differences in age, age of dam, nutrition, and management. The information is scaled to reflect the heritability of each trait and is finally expressed in units of product. If a bull has an EBV for weight at 600 days of +40, that tells us that his breeding value for that trait is 40kg above the breed benchmark. Given that he provides 50% of the genes inherited by his progeny, they are expected to average 20kg more than the progeny of a benchmark EBV bull (0). It is a relatively simple task to give a dollar value to the EBVs for each trait, then you know how much the bull is worth.