USA Beyond Borders - Spring/Summer 2013 by Semex

Spring & Summer 2013

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Beyond Through the past year Beyond Borders has taken you to China and Brazil. In this issue, we’re looking at India with its growing population and its desire to increase dairy consumption. Semex is there and we’re ensuring that dairymen in India have access to the genetics that will make them, just like dairymen everywhere, profitable.

Impression

4 6

And, we’re growing to meet the demands of

Evolving Jersey Program

countries like China, Brazil and India. We’re also investing and expanding with a dedication to our customers and our owners. Working together we will establish the lifelong partnerships that will develop long-lasting and

India

profitable herds. One example of that is Reuter Dairy in Peosta, Iowa. Semex Genetic Consultants work closely with the Reuters to ensure their genetic strategies are long-lasting, profitable and on target for their goals. Genetics for Life is all about enhancing lives and how we will feed the lives of tomorrow together.

18 14

Managing Drought

We invite you to read more about Semex’s Genomax™ program, exciting new release sires as

Reuter Dairy

What type of herd are you anyhow?

Semex Reports

well as India and the Semex story in this newest

edition of Beyond Borders. We hope that you enjoy reading it and that like us, you believe in Genetics for Life.

BEYOND BORDERS IS A MAGAZINE DESIGNED TO PROMOTE DAIRY GENETICS, TECHNOLOGY AND MANAGEMENT PUBLISHED BY SEMEX. Comments or submissions to the editor should be forwarded to Brenda Lee-Turner, Semex, 130 Stone Road West, Guelph, Ontario, Canada N1G 3Z2. tel: 519-821-5060, fax: 519-821-7225; email: bturner@semex.com Sexxed™, Genomax™, Genomax Plus™, Repromax™, ProMate™, ReproMix™, Premier™, HealthSmart™, ai24™, ShowTime™, .25Plus™, CVG™, Robot Ready™, Calving Ease™ and Immunity+™ are registered trademarks of Semex.

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LEADING GENETICS Genomax™ sires are the youngest and brightest sires that are available globally. Semex’s rigorous genomic young sire standards means that these bulls are the very best young bulls in the world.

Top 30 GTPI Sires with a stud code

12 TM

Ready

Robot Ready 0200HO03877 Show Time

mation

Built for Automation 8

Show Time

COYNE-FARMS Master Series JABIR 99%-I TM

res

Series

Master Series 4

Repromix

Ease

+2498 GTPI Calving #2 GTPI ACTIVEEase SIRE Polled Red & White Semex Tropical Genomax Plus

(200HO)

romax-Calving Ease

STUD A

STUD B

STUD C

Calving Ease Polled Red & White Semex Tropical Genomax Plus

STUD D

ALL OTHERS

Holstein USA High Ranking GenomicTMYoung Bulls (with a stud code), April 2013

High Fertility Pooled Semen SEMEX

White Tropical ax Plus

Time Tested Sires

Repromix FACEBOOK X FREDDIE X RAMOS

ooled Semen

Elite Show Sires

Sires

mix

Robot Ready

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Genomax-Repromax-Calving Ease

Brenda Lee-Turner, Semex Marketing Communications Specialist

New Repromax™ Sire Delivers Genetics for Life

0200HO00560 Monument Impression Semex believes that Genetics for Life is about delivering the best possible product to our clients. Each proof round gives us the opportunity to reaffirm this commitment to our customers worldwide. In April 2013 Semex delivered on this promise with the release of one of the industry’s Top 10 new release sires, 0200HO00560 Monument Impression. Impression is certainly unique being the breed’s only proven Socrates son. He’s from a VG-85-2YR-USA Potter from a VG-883YR-USA DOM Durham sister out of Wilcoxview Jasper’s EX-91-USA GMD DOM full sister, making him a very interesting option for dairymen looking for an alternative bloodline.

“His current MACE evaluation for production has 152 daughters in 78 herds in the US and 117 daughters in 112 herds in Canada. For conformation his evaluation to date is built on 55 daughters in 34 herds in the US and an additional 60 daughters in 56 herds in Canada. In the US he has daughters in 17 different states with California, Wisconsin and New York having by far the most, followed by Michigan and Washington. His proof is certainly diverse and represents our proving program’s philosophy.”

“His daughters are the whole package! ”

As a Repromax™, HealthSmart™ and Robot Ready™ sire Impression is designed to help you meet the top priority on your dairy… Getting those healthy calves on the ground that become profitable members of your herd. Siring balanced cows with exceptional PTAT of +3.08, superb udders at +2.93 UDC and breed-leading TPI at +2099, Impression ranks in the Top 30 for USA TPI with 95% reliability!

“A product of Semex’s Premier™ sampling program, Impression was dual-sampled in both the US and Canada through regular, classic, progeny test programs,” says Bill Hageman, USA Genetics Manager.

Field reports and video footage available on Semex’s Youtube channel support Impression’s impressive debut numbers.

“Premier™ Consultants from coast to coast agree that his daughters are the whole package,” says Jessica Lundgren, Semex Midwest Premier Consultant. “Impressions have openness to their frames and great mammary systems, validating their will to milk. They also have a great uphill run to them with a nearly perfect rump angle and great width to their thurls and rumps.” If you’re wondering what his best feature is, Lundgren doesn’t hesitate. “Udders are his strongest point!” she says. “They have tremendous height & width to their rear udders along with strong fore udder attachments. Impression’s ability to sire long dairy cows with ideal strength, great rump width and fantastic mammary systems makes him a very exciting new proven bull!”

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Bill Hageman, USA Genetics Manager

Jessica Lundgren, Semex Midwest Premier Consultant

HIGH FERTILIT Y SIRES

HILLTOP-LLC IMPRESSION 4740 GP-82-2YR-USA

HILLTOP-LLC IMPRESSION 4728 VG-85-2YR-USA

USDA-CDCB/HAUSA (4-13)

Dual sampled in Canada and USA, new release sire Impression ranks high for both LPI and TPI and offers something different with his outcross pedigree. Impression is designed to help you meet the top priority on your dairy… Getting healthy calves on the ground. He’s a high fertility Repromax™ sire, and will help your herd’s reproductive performance, longevity and profitability, one straw at a time.

0200HO00560

MONUMENT IMPRESSION

Impression is Genetics for Life.

SOCRATES x POTTER

GMACE TPI +2099 www.semex.com –5–

Russell Gammon, Semex Jersey Program Manager

EVOLVING INTO TOMORROW TOGETHER: SEMEX JERSEY PROGRAM What we hear, see and learn from you drives us. It’s about you, and together, the Semex Jersey program is evolving into tomorrow.

The results are a stable of sires that certainly typify Genetics for Life. Semex Jersey sires are fertile bulls with healthy daughters that know how to work. These daughters are built to last and ask very little of those caring for them, making them the most profitable cows on dairies.

The April 2013 release of the year’s first official genetic evaluation took our already buoyant energy and Jersey Recently, Semex made some revolutionary passion to a whole new level! And, no changes in its Jersey sire selection criteria place is this passion more evident than in as opportunities to work with more Jersey our breed-leading Genomax™ program. clients and growing national Jersey Semex’s Genomax sires are the result of populations expanded. In 2012, these the industry’s most rigorous selection changes led to increased sales activity process. This has helped identify some of that outstripped industry averages. Now the most in-demand progeny proven bulls with the expansion of Sexxed™ semen in the world. And, they are proof positive offering, the identification of more that Genomax bulls should be used Immunity+™ sires and our sire lineup’s confidently to maximize genetic gain. growth, Semex’s Jersey future looks even brighter! Our selection criteria focuses heavily on customer value and profit-making traits such as Cheese Merit $, the Jersey Udder Index (JUI) and the important fitness traits, while constantly hunting for genetic diversity.

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Genomax™ Lineup: • The release of Genomax and HealthSmart™ sire 0200JE00514 DP Frontrunner in early 2013 caused a furor! The super-high enthusiasm level for this young sire has been at fever pitch because:

- His pedigree marries Premier with Iatola, offering a respite from the prominent bloodlines in the breed

- He offered a prime opportunity to utilize and integrate one of the rising cow families of the breed, the Flower Family at Desert Park in Oregon

- His numbers glistened then as they do now, with stats of +5.66 for JUI and a high +661CM$ building toward his high-ranking +219 GJPI

- His Jupiter maternal brother 0200JE00513 DP Goliath is one of our upcoming leading young Genomax sires, offering a powerful combination of 68 pounds of fat, 56 pounds of protein, yielding a CM$ in excess of +510 and a GJPI of +211

• We have identified and will release Genomax™ sire 0200JE00511 Vermalar Bruce (Branson x Iatola) in the Summer of 2013. He brings a unique pedigree, exceptional overall type and JUI numbers to the table. Bruce is an ideal expression of our commitment to offering truly valuable genetics, sporting a sky-high +2.4 for type! No surprise then that Bruce’s JUI is an equally impressive +6.18. What is even more valuable is that Bruce has a pedigree, like popular 200JE sires Renegade and Frontrunner, that is much different than the common bloodlines in the population. His sire Branson offers popular sires such as T Bone and Action, while on the maternal side, Iatola and Remake sired his dam and granddam.

Genomax Graduate: Renegade Leading proven sire 0200JE00060 BW Renegade, a high fertility Repromax™ and HealthSmart™ sire, has been a Jersey sales leader for over three years. Every day producers reach out to tell us that they enjoy milking their profitmaking Renegades, and they’re working to make a lot more of them to populate their herds! At +85 pounds of fat he ranks in the top 10 of the breed for proven sires in the USA. Couple this with a top 10 ranking for his extraordinary fat percentage of +.35% and his third place ranking in the USA for CM$ of +642 makes perfect sense! Every sire we launch, including Frontrunner, Renegade and Bruce, is there for a reason. These reasons vary from breed-leading overall numbers, quality outcross genetics, exceptional type, health strength or the ability to sire daughters that perfectly fit specific milk markets. Ultimately, however, our goal relates to what we’re hearing from you, our customers worldwide, constituting Genetics for Life wherever Jersey cows are found.

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Jake Kempel, Semex Partner Development Manager

CONSULTANTS AND EFFICIENCY ARE KEY AT REUTER DAIRY If you were going to build the ideal dairy what would it look like? Four row, sand-bedded freestall barns with one stall per cow for every lactation stage? A large holding area and parlor designed for easy cow flow? A roomy, pre-fresh pen with freshly bedded straw and plenty of bunk space? Fans, fans and more fans? How about cow and heifer facilities so clean you could literally eat off of the floor?

Maximizing pregnancies and cow health are two major areas that Rick and Dan have always focused on. Natural heat detection and monitoring fresh cows was something they were always very successful with, but this became more challenging as their herd grew. They started relying more on synchronization protocols and spending more time with the fresh cows just to stay at the top of their game.

If that’s your dream, then welcome to Reuter Dairy in Peosta, Iowa! There is no doubt that cow care comes first for the father-son team of Rick and Dan Reuter.This family operation has Rick taking care of the feeding and fieldwork, Rick’s wife Elaine caring for the calves, Dan managing the cows and Rick and Dan overseeing the farm and making decisions together.

The idea of rumination monitoring really intrigued the Reuters and prompted them to start looking into the Semex ai24™ system. After discussions with Semex representatives and reviewing the possible return on investment in areas such as labor, hormones, decreasing the severity of fresh cow treatments, as well as increased conception and pregnancy rates, they decided to implement the ai24 system a year ago in April 2012.

Rick grew up on his father Jim’s 150-cow dairy farm south of Dubuque, Iowa. In 1975 Jim purchased the current farm where Rick began milking 80 cows on 260 acres. The herd continued to grow on its own until 1997 when Working with Dan Reuter they built a new parlor and freestall barn, allowing them to expand to 240 cows. The Reuters continued gradually growing with minimal risk to today’s 850 cows, 850 heifers and 12 employees. The Reuters grow all corn for silage on 800 acres, and buy hay and grain mix to complete their ration. They currently average 100 lbs/cow/day with a RHA of 30,676, 3.7% Fat, 3.2% Protein, and a SCC of 68,000. The SCC average for the last eight years has been 75,000.

“The rumination is awesome,” says Dan. “We are spending a lot less time looking at cows because I have this watching them 24/7. We are using less treatment medications because it (ai24) allows us to make more timely decisions on questionable cows. This lowers the severity of treatments and drops in production. We are even not treating poorer looking fresh cows that we would have treated before because their rumination is fine and they take care of themselves.” “You can’t teach cow sense,” comments Dan. “You either have it or you don’t, but ai24 helps either way!”

The Reuters have also seen a significant boost in reproduction since Key to the Reuters’ evolution and profitability are efficiency and installing and have become more efficient in labor and hormone use, as consulting, and this father-son team has always looked for ways to invest well as pregnancy creation. The faster they get cows pregnant after their money in the operation to maximize profits. Dan, who owned and operated 60-day voluntary waiting period, the quicker their fresh cows get off to a his own hoof trimming business for seven years before returning to the good start and the easier it is to keep milk production up. Dan has used farm comments about learning from others, “I really enjoyed meeting a lot the activity information to help maximize conception rates on cows and of new people and seeing a lot of different operations and opinions in my heifers, with less than 10% of their breedings being Timed-AI. time away from the farm, but I sure was happy to get back!” “There is no room to spend money wastefully in this industry anymore. The cows and investments have to be profitable,” said Dan.

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L to R: Dan Reuter and Semex’s Jake Kemel & Scott Hodgson

WORKING TOGETHER

“Consulting is very important. We love hearing about, and asking other people how they do things. Consultants see a lot more than we do, and we wouldn’t know the right or wrong way to do something unless we asked and other producers shared their results,” says Dan. The nutritionist, vet and Semex Genetic Consultants are just a few of the people these folks use to bounce ideas off of and collect advice.

Current Cow & Heifer Reproduction Snapshot (April 2013): Current Days Open: 111 Current Days to First Service: 69 Current % Herd Pregnant: 64% Pregnancy Rate Since September 1, 2012: 32 Heat Detection Rate Since September 1, 2012: 68% Overall Conception Rate (Cows) Since September 1, 2012: 46% First Service Conception Rate (Cows) since September 1, 2012: 49% Overall Conception Rate (Heifers) Since September 1, 2012: 69% First Service Conception Rate (Heifers) Since September 1, 2012: 69%

Rick and Dan have always been very strict with their genetic requirements, using a consistent selection criteria of mediumsized cows with good udders and feet & legs, with a balance of production, fat and protein and health traits specific to somatic cell score and daughter pregnancy rate. “Building up our genetics is extremely important. It’s just as important for the operation as it is the marketing side of things,” says Dan. Dan works with Semex Genetic Consultant Scott Hodgson, Sire Analyst Brian Behnke, Midwest Premier Consultant Jessica Lundgren and me in their genetic planning. Right now Reuters are using Semex’s highly reliable proven lineup, exciting Genomax™ bulls and high fertility Repromax™ sires. “Dad always says there is no industry like the dairy industry,” says Dan. “We are all working together to help each other be more profitable. Surrounding ourselves with great people has allowed us to become more and more efficient, and to add more cows.”

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Amar Dhumal, Head Sales & Marketing, Semex-Provet Genetics (I) Pvt. Ltd.

SEMEX BEYOND BORDERS: INDIA The Indian dairy sector has experienced substantial growth in recent years. This has resulted in India being the world’s number one milk producing nation, with an annual output of about 127.3 (anticipated) million tons of milk during 2011-2012, compared to 121.8 million tons in 2010-2011. This represents sustained growth in the milk production, and more importantly, in the milk products made available for the growing Indian population. Additionally, dairying has become an important secondary income source for millions of rural families, and has assumed the extremely important role of providing employment and income for marginal and female farm workers. Mainly produced by small farmers and landless labourers, the Indian per capita milk availability reached 0.61 lbs/day during 2010-2011. This is still lower than the world average of 0.62 lbs/day, but with the help of government programs it is on the rise. The Indian government is working to strengthen the entire dairy sector through various development programs. These programs include: the Intensive Dairy Development Program; Strengthening Infrastructure for Quality & Clean Milk Production; Assistance to Cooperatives and Dairy Entrepreneurship Development Scheme.

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However, in order to meet this rapidly growing demand for milk, the government has focused on improving milk production, and in February 2012 approved the National Dairy Plan Phase-I (NDP-I). NDP-I will help India meet the projected national demand for 150 million tons of milk by 2016-2017 through domestic production enhancements. These enhancements include strengthening and expanding the village level infrastructure for milk procurement, and providing producers with greater access to markets. This strategy also involves improving bovine genetics, producing quality bulls, superior quality frozen semen and adopting adequate biosecurity measures. The program will be implemented by NDDB (National Dairy Development Board) through end implementing agencies like dairy cooperative federations or unions. NDP-I will focus mainly on the 14 major milk producing states that account for over 90% of India’s milk production: Uttar Pradesh; Punjab; Haryana; Gujarat; Rajasthan; Madhya Pradesh; Bihar; West Bengal; Maharashtra; Karnataka; Tamil Nadu; Andhra Pradesh; Orissa; and Kerala.

350 300 250 200 150 100 50 0

1991-92

1995-96

2000-01 2005-06

2006-07

2007-08 2008-09

2009-10

2010-11

2011-12* *projected

The average annual rate milk production growth rate has been around 4% during the last decade, double that of the population growth. The per capita milk availability has gone up from 197 grams/day in 1995–1996 to 281 grams/day in 2010–2011, close to the global average per capita availability of 284 grams in 2009–2010.

Per Capita Availability (gms/day)

THE INDIGENOUS DAIRY BREEDS OF INDIA: Most tropical indigenous cattle breeds in India are multipurpose due to physical and economic parameters (milk, draught and buffalo), with only a few breeds having good milk Built for Automation production.

Robot Ready

Semex In India 350 Genetics (I) Pvt. Semex and India’sMILK Provet Genetics formed a joint venture, Semex-Provet PRODUCTION - ALL INDIA Ltd., in February 2012. Successful to date, this venture has proven to be300 popular with Indian dairy producers, capturing a significant share of the imported semen market. 250

140

Production in million tonnes

120

“Our dream is to develop cows that can produce more than 22,000 lbs of200 milk per lactation 150 for the Indian dairyman,” says Pratap Bhosale, General Manager Semex-Provet. “Semex and Semex-Provet are committed to the Indian producer with future plans involving a state-of100 the-art bull centre catering to the Indian market.” 50

100 80 60 40 20 0

Show Time

Milk Breeds:

Sahiwal, Red Sindhi, Gir and Deoni. Elite Show Sires

Dual Purpose Breeds:

Master Series

Ongole, Hariana, Kankrej, Tharparker, Time Tested Krishna Valley, RathiSires etc.

Repromix

Draught Breeds:

“Markets like India can be a dream or a nightmare for an AI company depending on 0 Khillar 2009-10 2010-11 2011-12* 1991-92 & Business 1995-96 2000-01 2005-06 2006-07 2007-08 2008-09High Fertility Pooled Semen their perspective and sales strengths,” says Sam Mitra, Semex Director, Sales *projected Development, Central & Eastern Europe, Middle East & Asia. “For Semex, withPer Capita ourAvailability sales(gms/day) Buffalo Breeds: 2003-04 2004-05 2005-06huge 2006-07strengths 2009-10 2010-11 segmenting and cost 2000-01 2001-02 2002-03 2007-08 2008-09 operational efficiencies and our in identifying, Murrah effectively servicing varied market segments, India is a prime market for growth and Surti development. I am sure that within a few years India will be one of our leading markets Nili-Ravi MILK PRODUCTION - ALL INDIA WORLD TOP 10 MILK PRODUCING COUNTRIES IN 2011 (including Cows/Buffalos) globally.” Jaffrabadi 140 TM

Calving Ease Polled Pandharpuri Mehsana etc. & White Red Semex Tropical Genomax Plus TM

140 350

Important to this is the support and development of tropical breeds120 and water buffalo.

Production in million tonnes

100

Production in million tonnes

120 300 Domesticated in India approximately 5000 years ago there’s over 172 million head of water

buffalo worldwide, making buffalo the second largest source of milk in the world. In India 80 200 this accounts for a significant portion of milk and milk products. 250

80 150 “To be a leading edge bovine genetics player in India we need to expand our product range

into buffalo and tropical dairy breeds. In many circumstances these40 would be the preferred 20 and optimal choice for our clients and it is only natural that we develop an expertise in these 50 breeds in addition to our leadership in Holsteins and Jerseys,” says Mitra. “This is Genetics 0 40 0 2000-01 2001-02 2002-03 2003-04 2004-05 for in India.” 1991-92Life1995-96 2000-01 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12* 60

100

Genomax-Repromax-Calving Ease

2005-06 2006-07

2007-08 2008-09

2009-10

2010-11

WORLD TOP 10 MILK PRODUCING COUNTRIES IN 2011 (including Cows/Buffalos) India

USA

China Pakistan Brazil

Russian Germany France Federation

MILK PRODUCTION - ALL INDIA 140

New United Zealand Kingdom

Production in million tonnes

Milk Production

120 100 80 60 40

140 120 100 80 60 40 20

20 0 2000-01

2001-02

2002-03 2003-04

2004-05

2005-06 2006-07

2007-08 2008-09

2009-10

2010-11

0 India

USA

Milk Production

WORLD TOP 10 MILK PRODUCING COUNTRIES IN 2011 (including Cows/Buffalos) 120

Per Capita Availability (gms/day)

140

*projected

Production in million tonnes

100

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China Pakistan Brazil

Russian Germany France Federation

New United Zealand Kingdom

Mark Carson, MSc., BSc. Agr., EastGen, Reproductive Strategy Manager

WHAT TYPE OF HERD There are many ways to benchmark your herd’s reproductive performance. But, pregnancy rate is the best measurement to use when it comes to getting a sense of how well your whole herd is doing. This is because pregnancy rate answers the basic question of how many of your open cows are getting bred in a timely fashion. And, it tells you if those breedings are getting your cows pregnant.

an opportunity to improve conception rate, improve insemination rate, or both. First, though, we needed to classify what constitutes a low conception or low insemination rate.

$171 per cow per year in reproductive opportunities

$36 per cow per year in reproductive opportunities

Average days open 138

Average days open 108

35%

of herds

50% insemination risk 40% conception risk

50% insemination risk

A herd with a low insemination 40% conception risk 40% conception risk rate was defined as breeding less Average days open 154 Average days open 124 than 50% of the available open If you want to improve pregnancy rate, cows waiting to get bred during of herds of herds you need to know where the big picture a year. A high insemination rate $243 per cow per year in $108 per cow per year in opportunities for improvement are. You reproductive opportunities reproductive opportunities was defined as breeding over need to either improve the conception rate 50% of the available open cows of the cows you’re breeding, or improve the during a year. Although the A Low Insemination Rate/ ability to detect cows in heat. And then, just recommended goal for insemination rate is Good Conception Rate Herd as important, you need to find out how your 60%, it was decided to use a lower number herd compares to your neighbours’ herds and to account for different voluntary waiting The first group of herds (35% of the dairies) other herds in the industry. had low insemination rates, while their periods between herds. conception rate was considered to be good. So, how many herds need to focus on A low conception rate herd was defined as improving conception or insemination rates? getting less than 40% of cows pregnant after The average days open for this group was 138 days with an average economic opportunity How many need to focus on both? breeding annually. A high conception rate of approximately $170/cow/year. These To get a sense of how the industry is herd was defined as getting more than 40% herds should focus on getting more cows performing at the herd level, and where of cows pregnant after breeding annually. At bred. To get more cows bred in a timely opportunities exist we looked at data from 40%, the conception rate is slightly above fashion, they need to either spend more 2,300 CanWest DHI herds that collect good the industry average of 37%, but this figure time doing visual heat detection, increase reproductive data. is achievable for all dairies. the usage of timed AI or deploy an activity These herds were divided into four different monitoring technology such as Semex’s categories, based on whether they had ai24™. Most herds with high insemination

45%

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15%

D ARE YOU ANYHOW? rates deploy more than one heat detection tool, minimizing the chances of missing any open cows. Also working with your herd veterinarian is very important in order to make sure that you’re conducting pregnancy checks at the appropriate frequency.

A Low Conception Rate/ Good Insemination Rate Herd The second group of herds (15% of dairies) needed to improve their conception rates, while their insemination rate was considered to be good. Their average days open was 124 days with an average economic opportunity of approximately $108/cow/ year. For this particular group, the goal would be to focus on ways to improve conception. Primary areas to focus on would be improving the cow’s fertility through transition, nutrition and environmental management. As well, they should consider reviewing heat detection and timed AI protocols to make sure that timing is being delivered as effectively as possible. For owner inseminator herds, reviewing semen handling and placement on an annual basis is beneficial.

A Low Conception Rate/ Low Insemination Rate Herd

A Good Conception Rate/ Good Insemination Rate Herd

The third group of herds (45% of dairies) needed to improve both conception and insemination rates. Their average days open was 154 days with an average economic opportunity of approximately $243/cow/ year. With opportunities existing in both areas, and with a lot of potential money to be made from an investment in reproductive performance, any investment made that improves both conception and insemination rates will give a great payback.

The fourth and final group of herds (just 5%) were considered to have both good insemination and conception rates. This shows in their low average days open at just 108 days and small economic opportunity of $36/cow/year.

Interestingly, the data showed that if you had to pick just one area to improve, raising insemination rates gave the better return. The average days open for herds that have a high insemination rate was 14 days less than the high conception herds, for an economic difference of approximately $60/cow/year. Ideally, you should focus on improving both, but this shows that getting semen into cows by improving your insemination rate can be an effective way to improve your herd’s overall reproductive performance.

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Although this elite group of herds is doing well reproductively, there are always opportunities to improve. If your herd falls into this category, look at small adjustments in your reproductive program, and make sure you are taking full advantage of the genetics you’re using in order to meet your goals. So what category of herd are you? Take a minute and review your herd averages for conception and insemination rate and see where your herd falls, and if you’re not at the elite level, make the necessary changes to help your herd get there.

SEMEX REPORTS GROWTH IN REVENUE, PROFIT & RETURN ON REVENUE IN 2012 Semex’s Chief Executive Officer Paul Larmer has recently reported 2012 to be a great success for Semex. “In the past three years we have witnessed growth in all three of our major focus areas: Revenue; Profit; and Return on Revenue,” says Larmer. “In 2012 we witnessed record revenues and achieved targets originally established for 2015. Our increasing diversity has proven to both strengthen our solutions offering to our customers, and decrease our reliance on specific markets and specific products. Additionally, we’ve supported growth in new areas and to new customers, all while enhancing existing relationships with our loyal customers.” In 2012 Semex remained steadfast in its dedication to its customers. This was evident in many areas with the following being just a few of this past year’s highlights: Genetics for Life supports Semex’s evolution as a company, defining who Semex is and what Semex stands for while embracing the longevity of both its genetics and client relationships. Additionally, it promotes Semex’s social and business responsibility to support global food production in order to nourish our growing population. Semex’s commitment to research and development continues, and has yielded new, game-changing and innovative technologies that have been added to its portfolio:

Paul Larmer, Semex’s Chief Executive Officer

Semex’s R&D arm, Boviteq, is now able to perform genomic biopsies on conventional and IVF (In Vitro Fertilization) embryos. This adds efficiencies to Semex’s genomic testing program and saves its clients money. In order to select the very best entrants to its genetic program Semex genomically tested well over 5,000 young

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bulls globally in 2012. And, while many competing companies are now in the business of owning females, Semex continues to support its breeders by partnering with them. Semex believes these partnerships offer a mutual success developing and acquiring elite sires.

120

100

Semex invests approximately $10 million into industry infrastructure and data collection each year as it believes data integrity and data collection are key to maintaining and increasing the accuracy of genomics. Semex will continue this support, working with industry partners on behalf of its members, and for the entire industry’s long-term success.

Semex continues to focus on product quality while developing efficiencies in our housing, production and distribution facilities. In 2012, Semex opened a new distribution centre in Guelph, Ontario, replacing three existing facilities. With additional enhancements planned for 2013, Semex’s Gold Standard™ ensures excellence at every point of housing, production and distribution at each of its centres located on four continents.

15.0%

MILLION

0 2008

2009

2010

2011

2012

Revenue

TREND 15

“Semex is well positioned to meet changing markets and to continue to capture market share,” says Larmer. 5.0% “Our global investments give us diversity and assist us as we drive growth while excelling in developing markets. As markets 0.0% change, Semex will continue to 2008 2009 2010 2011 2012 strategically evolve, meeting needs and expanding our global footprint.” 10.0%

-5.0%

-10.0%

Return on

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TopCross

Crossbreeding for Profit

.25 Plus

.25Plus™ Best Use Practices Semex recommends utilizing a universal insemination gun and tweezers (or ¼ cc gun and tweezers) along with the following standard handling procedures when using the ¼ cc straw: • Ensure a warm, draft free environment for thawing semen • Be sure that all equipment including guns, sheaths, and paper towels are warm before coming in contact with thawed straws • Hands should be clean • Keep equipment free of contamination, use clean thaw water • Use a 1-pint, wide-mouth thermos filled with clean water and a dial thermometer to thaw straws • Periodically confirm the accuracy of your thermometer by comparing it to a known standard • Check to make sure that the thermos water temperature is 98°F (36.6°C) before each straw is removed from the tank – 16 –

• Always use nitrogen cooled tweezers to handle the straws; fingertips should not be used • Thaw semen in 98°F (36.6°C) water for 60 seconds • Only thaw one straw at a time • Breed cow as soon as possible. No longer than 15 minutes after thawing • Use paper towels to clean vulva, use a clean towel to open vulva • Keep the tip of gun that enters cervix & uterus free of contamination • Ensure animal is in heat by picking up the cervix and uterus. If you get a clear mucous discharge from the vulva it’s a good sign she is in heat

Robert McRae, Semex Vice President Global Operations

Semex is pleased to announce the recent opening of its new semen distribution facility. Located at its production center north of Guelph, Ontario, Canada, this state-of-the art facility is the direct result of the increased demand for Semex’s product globally. “With worldwide demand growing year after year, Semex is committed to providing our customers with the highest quality semen possible, while increasing efficiency in our operations,” says Robert McRae, Semex Vice President Global Operations. “This is all part of the Semex Gold Standard™, representing Semex’s commitment to our customers, and our mandate at each of our production facilities worldwide.”

Growing to meet

global demand – 17 –

Semex’s Gold Standard demands excellence in all aspects of semen production, handling and distribution including: genomic selection; sire care; semen collection; semen processing; semen evaluation; storage & distribution; and fertility. This Gold Standard is directly tied to Genetics for Life, because at Semex we understand that the top priority on any dairy, anywhere in the world, begins and ends with getting healthy calves on the ground. “We are continually working to improve our semen quality and fertility,” says McRae. “This new distribution center underscores Semex’s commitment to our product and to our staff. We know that our people are the cornerstone to our success, and in order for them to be successful and to produce a top-quality product they must work in the best environment possible.”

Mike North, Sr. Risk Management Advisor, First Capitol Ag

MANAGING DROUGHT ON TWO CONTINENTS There has been a lot of discussion about New Zealand in recent months following the drought that impacted the end of their 2012-2013 production season. But, is such an event a very big deal? Let’s take a closer look at the numbers. New Zealand is composed of two islands (North Island and South Island) located southeast of Australia supporting a population of 4.4 million, similar to the great er San Francisco/Oakland area. The population of its milking herd, however, is approximately 5 million head, up 4% from the previous year, with the North Island being home to nearly 70% of them. Milk production in 2012 was roughly 45 billion pounds. Given that their herd is greater than their population, 95% of that production is exported in one form or another. This is a sharp contrast to a world model where 95% of domestic production is consumed internally. Their export activity not only generates nearly $11 billion, but it supplies the world with 40% of the butter traded on the international market, 27% of skim milk powder and 38% of the whole milk powder. By volume and value, whole milk powder is the greatest contributor to these sales, accounting for 42% of annual sales. Butter, anhydrous milk fat, and cream products account for another 20%. Skim milk powder, cheese, and protein products each contribute about 11% of the revenue. China purchases 20% of their production on a value basis, with the US a distant second at 7%. With New Zealand dairy production tripling in the last two decades, the rise of the Chinese economy has been critical for it to maintain growth and encourage expansion.

New Zealand is composed of two islands (North Island and South Island) located southeast of Australia.

This drought has now caused a tightening of supplies and world markets have raced to all-time highs as buyers have scrambled to secure available product. Whole milk powder, as sold on the Global Dairy Trade auction, has led the charge by doubling in price during the first quarter of the year to levels near $2.85/lb. This did not happen in a vacuum. The entire product basket saw impressive price rallies. Because of the contribution made by New Zealand this rally is warranted. The question is how long it is welcome (by the consumer/ingredient buyer).

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A word of caution

The arrival of precipitation in conjunction with large planting expectations and a less-than-capacity demand created enough pressure to reduce spot corn prices by 13% from their winter highs.

A rise in price causes buyers to back away from the market seeking only what they absolutely need or worse, substitutes. In line with our discussion about drought, another piece of wisdom must also prevail… All droughts end with rain. We need not look any further than our own back yard to understand this. Late snow and spring rains arrived in the western Corn Belt (the last part of the belt that was precipitation deficit). The arrival of precipitation in conjunction with large planting expectations and a less-thancapacity demand created enough pressure to reduce spot corn prices by 13% from their winter highs. That same cool and wet weather caused late spring planting and a consequential rebound from late April lows. The lesson learned is simple: Any market moved higher by drought concerns, can just as easily be moved lower when rain arrives. Some rains have already arrived in New Zealand to help re-seed and renew pastures for the coming production season. Summer weather will be closely watched. Not knowing exactly what lies ahead of us, producers should begin considering a strategy that provides flexibility in whatever comes of this drought debacle. With regard to feed, I would suggest a two-pronged approach: For your needs through summer, consider purchasing physical supplies of feed in advance of the summer period and using option strategies to defend those acquisitions; Post-harvest needs can be protected with call options to manage any potential rise in prices. Consult your risk management advisor for a strategy suitable to you.

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Actions taken in feed should be balanced with actions taken in milk. With the recent milk price rally and unknown effects of the 2012 drought, seek a strategy that provides flexibility – protection from falling prices and participation in rising prices. Here are a couple of strategies that you may consider: 1. Sell milk through the end of the year (via a contract with your plant or milk futures contracts…consult your advisor as to the requirements of both) and then purchase call options. A sale secures that price throughout the last six months of the year. The next step (in order to maintain flexibility) is to purchase a call option. This allows you access to any prices above that level. In the event of a drought rally, these call options can be worth their weight in gold. 2. B uy a put option strategy. This strategy allows you to maintain coverage against any fall in price below the level of the put option you purchase. By default, higher prices are still available to you if the market should find cause to move upwards. We have all scrutinized the predictions made by weathermen. The reality is that it is completely unpredictable. If we come to terms with that, we must also accept the fact that the market is also completely unpredictable. Manage the drought that has inspired price movement on two continents by implementing strategies that capture margin and allow flexibility. Obviously there are many more strategies available than what we can fit in this brief article. Feel free to give me a call if you have further questions. In compliance with Dodd Frank legislation, this article must be considered as a solicitation for your business.

IT’S ABOUT WORKING TOGETHER

Our Genetic Consultants are trained to listen, look and learn from you, then bring solutions and strategies to improve your herd’s performance and profitability. Most importantly, we understand that on your dairy it all begins with a pregnancy, and our clients work side-by-side with their Semex Genetic Consultants on reproductive strategies including ai24™, Repromax™ and Sexxed™ sires. It’s about working together to develop long-lasting, profitable herds and lifelong partnerships. That’s Genetics for Life.