1. Is There Gold in Them Thar Crossbreeding Hills? Darrh Bullock University of Kentucky

2. Simple Economics Income Cost Profit = Income - Cost

3. Income Weight Price Income = Weight * Price

4. Costs Overhead Development Maintenance Production

5. Economic Considerations Cow/Calf Producer –Calving Ease –Weaning Weight –Weaning Rate –Calf Prices

6. Economic Considerations Cow/Calf Producer –Longevity/Replacement –Cow Maintenance –Cull Cow Prices –Health Costs

7. Heterosis Impact on Profitability Weaned Weight/Cow Exposed Longevity/Replacement Rate Feedlot Performance Carcass Composition

8. Literature Lifetime input cost per value unit of weaned calf and cull cow output was reduced 6% by use of crossbred cow and 6% more with crossbred calf (Nunez-Dominguez, 1992)

9. Literature Total heterosis for total income was 15% (Lamb and Tess, 1989) Maternal heterosis for net profit was nearly $70/cow/yr (Davis et al., 1994)

10. Crossbreeding Calculator Bullock and Isaacs

11. Crossbreeding Calculator Download this from http://www.nbcec.org/nbcec/bb_IV/xbrd-spreadsh.xlshttp://www.nbcec.org/nbcec/bb_IV/xbrd-spreadsh.xls

12. Economics of Heterosis 85% Weaned/Cow Exposed 525 lb Wean Wt. $85/cwt Heterosis* –Maternal – 15% –Individual – 7% *Bourdon 2000

13. Economics of Heterosis Weaning Weight/Cow Exposed Cow %ABC A100 A75,B25 A67,B33 A50,B50 A50,BC25

14. Economics of Heterosis Weaning Weight/Cow Exposed Cow %ABC A1000 A75,B25$35 A67,B33$50 A50,B50$70 A50,BC25$70

15. Economics of Heterosis Weaning Weight/Cow Exposed Cow %ABC A1000$27 A75,B25$35$50 A67,B33$50$59 A50,B50$70 A50,BC25$70$78

16. Economics of Heterosis Weaning Weight/Cow Exposed Cow %ABC A1000$27 A75,B25$35$50$55 A67,B33$50$59$66 A50,B50$70 $83 A50,BC25$70$78

17. Economics of Heterosis Weaning Weight/Cow Exposed 2 Breed Comp (50%)$42 2 Breed Rotation (67%)$56 2 Breed Roto-Term (var)$61 4 Breed Comp (75%)$63 (Heterosis)

18. Longevity Calculator Bullock and Burdine

19. Longevity Calculator Download this from http://www.nbcec.org/nbcec/bb_IV/long-hetero.xlshttp://www.nbcec.org/nbcec/bb_IV/long-hetero.xls

20. Economics of Heterosis Longevity Based on results of Nunez- Dominquez et al (1991) using imposed culling policy Replacement Rate –Straightbred – 18.1% –Crossbred – 15.8%

21. Economics of Heterosis Longevity Mortality Rate –Straightbred – 20% –Crossbred – 9% Infertility – varied by age group (Actual Culling Prac)

22. Economics of Heterosis Longevity 550 lb steer calves @ $85/cwt 500 lb heifer calves @ $75/cwt Weights adjusted for AOD No price slide 1200 lb cows @ $42/cwt (adj)

23. Economics of Heterosis Longevity Economic differential –Fertility differences included $33.45/hd advantage –Fertility differences excluded $11.86/hd advantage

24. Economics of Heterosis Combined Economic Differential –Maximum Heterosis $95.31/hd –50% Heterosis $47.65/hd

25. Price Differential Straightbred calves must receive an almost $10/cwt premium to compensate for reduced production compared to minimal crossbreeding systems

26. Economic Considerations Feedlot –Morbidity (?) –Mortality (?) –Feed Efficiency (1%) –Margins

27. Economic Considerations End Product –Carcass Weight (4%) –Dressing Percent (0%) –Yield Grade (1%) –Quality Grade (1%) –Price Structure

28. Summary Profitability in feeder calf production is greatly impacted by crossbreeding Primarily due to heterosis

29. Summary Benefits in the feedyard and carcass traits are less impacted by heterosis, however, complementarity may play an important role here

30. Thanks Kenny Burdine Lee Meyer Steve Isaacs Fred Thrift

31. Questions Darrh Bullock University of Kentucky dbullock@uky.edu (859) 257-7514