ESTIMATION OF ECONOMIC VALUES FOR DAIRY-CATTLE BREEDING GOALS - BIAS DUE TO SUBOPTIMAL MANAGEMENT POLICIES

A bio-economic model of the dairy cow enterprise was used to evaluate biases in estimates of economic values of traits derived from systems with sub-optimal management decisions. Policies for replacement and insemination that maximize profit per cow over a planning horizon of 15 years were derived for a range of situations, using dynamic programming. Economic values of involuntary culling, conception rate and milk production were estimated from the change in profit resulting from a change in level of the trait, in combination with specified culling and insemination policies. True economic values were defined as those derived from a unit change, with use of an optimum policy before as well as after the change. Continued use of the policy optimum for the base level at the new level of the trait, resulted in biases in economic values of -0.3, -0.7 and 0.0% for involuntary culling, conception rate and milk production. Use of a policy which was sub-optimal at both the base and new level of the trait, and derived as the optimum policy for a situation with 50% larger replacement heifer costs, led to biases of -4.7, -8.4 and -2.6%. Only the economic value of conception rate was affected by size of the change from which it was evaluated, as a result of a non-linear profit curve. Omitting voluntary culling and ignoring variation in production led to biases in the economic value of involuntary culling by -29.9 and -9.5%. In conclusion, estimates of economic values of the traits evaluated were rather robust to the degrees and types of sub-optimality of culling and insemination decisions considered.