Costs & Benefits

Costs

Capital

ICBF has a share capital of some € 2.03 million with 54% held by the cattle breeding industry (Artificial Insemination members 18%, Milk Recording members 18% and Herd Book members 18%) and 46% held jointly by IFA and ICMSA.

ICBF has received capital grants from EU Structural Funds and the Irish National Development Plan.  These grants have been used to assist in the establishment of a national infrastructure for cattle breeding.  Projects benefiting from these funds include those that established the cattle breeding database and the genetic evaluations systems for dairy and beef cattle.

Operating

ICBF receives operating funds from the services it provides, a Grant from DAF and farmer contributions collected on ear tags.  This income is used to cover operating costs, and depreciation.  In 2005 ICBF’s operating income was some €3.35 million

 

Benefits

ICBF is focused on providing benefits to Irish cattle farmers, the cattle breeding industry and its member organisations. It does this by working with its members to deliver the following benefits:

Effectiveness Benefits

These are benefits due to improvement in the genetic quality of the cattle being farmed in Ireland and result as a consequence of:

    • Increased levels of ancestry recording in non-pedigree cattle.

      In 1998 some 40% of milk recorded dairy cattle had no known sire and 85% no known dam.  By 2005 these figures have reduced to 23% and 7% respectively.

Over the same period, 1998 to 2005, the number of beef and dairy calves born annually with a known sire has increased from some 120,000 to some 380,000.  Virtually all of the 280,000 increase is due to improved sire recording in non-pedigree cattle.

  • Increased levels of performance recording in pedigree and non-pedigree cattle.

    The 1998 the level of milk recording at 27% of milking cows was very low compared to levels in other developed dairy industries. By 2005 the level of milk recording had increased to 35%.  Our goal is to increase this to 60% over the next few years
    In 1998 level of beef performance recording was 1% of beef weanlings.  By 2005 the introduction of animal events and linkage to slaughter data the percentage of beef calves with some performance information had increased to some 10% of suckler calves born.

  • The establishment of breeding objectives and selection criteria

    that are shared by breeders and commercial meat and milk producers that reflect future market requirements for their products as well as the costs of production. In 2001 the EBI was introduced to replace the RBI (relative breeding index for dairy cattle).  By 2005 the EBI had become widely accepted as the most relevant criteria for use in breeding decisions for Irish dairy farmers even though its development is continuing.  In 2005 the concept of the beef EBI was introduced based on five sub-indexes which address aspects of beef production – beef calving, dairy calving, weaned calf, beef production and maternal.

  • Greatly increased availability of breeding indexes

    on pedigree and non-pedigree cattle that enable farmers to make more objective breeding decisions.  As the availability of breeding index information increases its importance in determining the value of cattle has increased and thus provides a greater incentive for farmers to keep records and utilise milk-recording and beef performance recording services provided by ICBF and its member organisations.

  • Increases in the genetic merit of the semen available

    from and through the Irish AI industry.  As the Irish cattle breeding industry increases its effectiveness the quality of semen available from ICBF AI members will increase relative to imports.  The G€N€ IR€LAND® breeding scheme introduced in 2005 in conjunction with ICBF’s AI members has had a dramatic impact on the EBI of dairy bulls being progeny tested and this will feed through to proven bulls in due course.

  • Improved farm management as a consequence of having better information

    on individual animal performance.  Experiences in other countries have shown that overall farm management improves when individual animal performance recording services are used.  By 2005 this benefit has become evident in dairy cow fertility as a result of the attention that ICBF and TEAGASC have drawn to the importance of good reproduction management and the provision of a range of reports that enable farmers to monitor progress.

 

Efficiency Benefits

These are benefits, which result from improvements in the efficiency with which cattle breeding services are provided to farmers. These benefits include:

  • The ICBF database and animal events recording systems introduced in 2002 removed duplication in the collection and processing of identification, ancestry, and reproduction data.  In 2006 AI Handheld computers were introduced.  These removed the need for manual docket processing while also providing more rapid return of more accurate information.  These developments have benefitted farmers by making record keeping a less onerous and time consuming task.  It also benefits ICBF’s service providing members by removing costs, improving accuracy and increasing the range of information available to guide management decisions.
  • The database has the potential to reduce operating costs in ICBF member organisations by removing duplication of work and by exploiting the economies of scale.
  • ICBF provides a means for its member organisations to work together in the development and provision of cattle breeding services. There are thus potential cost savings and benefits from more rapid service development.
  • As the number of farmers and cattle actively participating in cattle breeding increases there is the potential for member organisations to provide more cost beneficial breeding services to farmers. ICBF and its member organisations are committed to ensuring more farmers become involved in cattle breeding.

Quantification of Benefits

The quantification of these potential benefits involves numerous assumptions. The Ernst & Young report that gave rise to the establishment of ICBF identified and quantified benefits amounting to some € 37 million per year for the combined beef and dairy industries.  More recent work based on achieving optimal breeding scheme designs for beef and dairy cattle put the potential benefits at a cumulative €18 million per year for beef and a similar amount for dairy.   That is, after ten years to annual benefit, in terms of the contribution to industry profitability is some €360 million. It is important to recognize that a substantial part of the realization of these benefits will be through the activities of ICBF member organizations.

 

31st July 2006