The Billion Dollar Sceme

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The billion dollar scheme LIC’s Premier Sires team of artificial breeding bulls has generated more than 16 billion dollars to the New Zealand dairy industry and economy since it began. The Premier Sires team is responsible for siring three out of every four dairy cows being milked on New Zealand dairy farms today. This is the story of the scheme behind the bulls – the LIC Sire Proving Scheme. It’s a story of a partnership between farmers and their herd improvement co-operative, LIC. It’s a story which spans 50 years since the LIC Sire Proving Scheme was introduced in 1961, as seen through the eyes of the people involved.


Foreword It’s timely, as modern day 21st century New Zealand dairy farmers, to pause and reflect on the rich heritage of entrepreneurs, scientists and capable farmers who have developed, guided and paved our pathway for over a century. It is no accident that, combined, we have turned New Zealand’s competitive advantage of soil, sun and water into pasture and animal production which is the envy of the world. And it is no coincidence that the rapid advances in genetics enabled in the last 50 years have generated cows which, today, produce three or four times more than their forebears. We owe a lot to people like Olive Castle and Dr Pat Shannon who were the first in the world to design and develop a science-based breeding scheme that removed tens of thousands of negative and marginal production herd sires from the market and unleashed the opportunity to heavily use the very best ones. It was their vision which formed the basis for a Sire Proving Scheme which saw a select group of 300 to 400 farmers selected each year for their excellent stockmanship, observation and recording skills of essential phenotypes, and for their geographical disparity representing the varied climate, geography, herd size and pasture based farming conditions that we have in New Zealand. Those farmers have been the engine room of LIC’s front line product development. This tightly managed Scheme is recognised as among the largest and most accurate, efficient and cost-effective in the world, set up to optimise genetic gain. Having said that, it’s important to recognise that the Scheme has only been possible thanks to the users of LIC’s artificial breeding services who have funded it to the tune of $7-$10 million per year.

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The LIC Sire Proving Scheme has enabled annual selection of “the elite from the best” akin to the All Blacks selection from the Super 15 teams. Criteria for the Sire Proving Scheme has some similarities with elite sports in that performance is the ultimate test – with dairying it’s the production and non-production traits that are so important to us as farmers but it’s here that the comparison ends because performance in dairy animals is measured and evident in genetic gain. Genetic gain in New Zealand has steadily advanced at about 1.3-1.5% per year so it doesn’t take many decades for a 250 cow herd to be as efficient as a 400 cow herd used to be. In fact my university professor Dr Colin Holmes is quoted as saying we could not farm profitably today with the cows of the 1970s. The Sire Proving Scheme has constantly evolved since its official launch back in 1961 and there have been some significant milestones along the way. In 1996 the introduction of a profit index meant steady growth in production while limiting inefficient increases in live-weight; since then animal efficiency gains have been more pronounced based on a given unit of feed. Breeding Worth has been a hugely successful measure of evaluating profit per animal and herd and most people associated with dairying today, including scientists, bankers and other service providers, recognise it is the most reliable indicator of per cow performance, animal and herd value and farm profitability. As farmers, we owe our thanks to the dedicated Sire Proving Scheme farmers who have had to adapt to changing phenotype and genotype recording procedures over the years. We have all benefited as they proved the bulls by using semen from teams of young unproven bulls on their herds going on to milk and test the resulting daughters not only for production but for traits sought-after by New Zealand farmers – shed temperament, milking speed, live-weight, somatic cells and fertility to name a few.

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It’s a time consuming task but one most Sire Proving Scheme farmers commit to passionately because of the interest they have in genetics and because they know they are making a difference for fellow-farmers and the industry. Until 2008 the Sire Proving Scheme ‘graduated’ around 10 bulls (per breed) each year, from an original team of 200-300 bulls, into LIC’s flagship bull team – Premier Sires. The Sire Proving Scheme has, for the last decade, involved three breeds (Holstein-Friesian, Jersey and KiwiCross ) covering conventional and once-a-day milking strains, and short gestation length schemes. In 2008 one of the most exciting evolutions in dairy genetics occurred when DNA genomic science selection was harnessed to significantly enhance the Sire Proving Scheme by offering farmer members access to super elite young bulls chosen from among thousands, versus hundreds, of their peers. The reliability of these elite young sires is about double that of parent average (ancestry) Breeding Worth. This advance was a direct result of the large LIC investment of over $20 million, which began in 1994 with the aim to drive harder our on-farm profitability. Genetic gain has enabled nearly two thirds of total on-farm productivity gains and with the new generation DNA technology is likely to lift this to nearer 75%. The Sire Proving Scheme has delivered all that it promised 50 years ago, and more. It has been a very stable platform for over 50 years for our co-operative’s growth, giving us all great confidence for the future as we annually anticipate an even better team of bulls for the next crop of daughters. In essence, it is a platform of genetic sustainability for our farming businesses, our families and our industry into the future.

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In closing I often reflect on the fact that if only we had an equivalent system with our pasture varieties to match what has been achieved in dairy cattle breeding how much better still we could be in feeding a world with nature’s most amazing food. Farming is, and has always been, a family business. Many of today’s LIC shareholders can look back on a rich heritage in dairying, support of their cooperative and commitment to advances in dairy genetics. This book recognises that commitment as much as it does the individuals whose stories are recorded. The success of the Sire Proving Scheme provides one of the most tangible examples of the value of LIC as a farmer owned cooperative - farmers working together, for the benefit of their own businesses, their families, the industry and the economy. Stuart Bay Dairy farmer, and LIC Chairman

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