Archive for Sexing Technologies

ABS Global vs. Sexing Technologies: It’s Just Business

On September 12 The Bullvine broke the news that Sexing Technologies was suing ABS Global for fraud and breach of contract (Read more: Sexing Technologies sues ABS Global for fraud, contract breach), kicking off what has become a much debated discussion in the A.I. industry. This was the first public announcement of a legal battle that has been going on behind the scenes for some time now.

At the heart of the issue are two companies simply trying to do what is best for their business. However, as is usually the case in the passionate dairy industry, routine business procedures have turned into a heated debate.

In 2003 Inguran LLC., which does business as Sexing Technologies or ST, licensed the semen sexing technology from XY technologies who had performed considerable research in the 1990’s to optimize the efficiency of the sorting procedures first initiated in the 1980’s by USDA. The partners in the business eleven years ago went heavily into debt to obtain a license from XY Inc. Additional partners came into the business, and Sexing Technologies started its commercial sexed semen production ten years ago having Select Sires as its first large commercial customer.  The technology has changed dramatically, especially in the last five years. A considerable amount of time and resources have gone into developing new generations of equipment, changing procedures, making media improvements and raising user awareness. For example in the last five years we have gone through five different new models of sperm sorters, each one an improvement on the previous one. Thus, production efficiency has improved considerably, and the end user has benefitted by seeing a significant price reduction in the cost for their sexed semen compared to when ST introduced it in the marketplace ten years ago. Juan Moreno, Co-CEO of Sexing Technologies, (Read more: SEXING TECHNOLOGIES: Gender Vendors in a Changing Marketplace) shared the following stats:

  • 1984 to 2000
    Purity Under 80%
    Low Fertility (below 50%)
    1000 doses of conventional semen would produce 200 doses of sexed semen.
  • 2002 to 2012
    85% Purity
    About 80% fertility rate of that of conventional semen.
  • 1000 doses of conventional semen would produce 400 doses of sexed semen.
  • Current
    93% Purity
    98% fertility rate of that of conventional semen.
    1000 doses of conventional semen can now produce 1100 doses of sexed semen.

As a result of making these leaps and bounds in the efficiency and increased fertility, the marketplace has certainly taken a liking to using sexed semen (Read more: Sexed Semen from Cool Technology to Smart Business Decision).  This increased demand has also led to higher profits for ST and has propelled them into even more significant research as well as very aggressive protection of their license and their patents.  During this time there have been other attempted developments of sexed bovine semen sorting such as Gensel, Heifer Plus, Microbix as well as efforts by Monsanto, though ultimately it has been ST which has prevailed.

It’s these aggressive tactics that are in question in the legal proceeding between ABS Global and ST.   According to Jesus Martinez, ABS Global Director of Business Development “ST’s practices not only limit choices for genetics and artificial insemination companies, but more importantly, they inhibit scientific progress important to our dairy and beef customers” On July 14th  ABS filed legal action against Sexing Technologies in the U.S. district court of western WI, based in Madison. (Read more: ABS Global, Inc., files suit against Sexing Technologies) “We believe it is in the interests of both ABS and the whole bovine genetics industry to have free and fair competition in the market for processing sexed bovine semen.”

The counter suit filed by ST, filed in Houston federal court, claims ABS Global committed fraud by signing the five-year contract, and inducing Sexing Technologies to sign, with no intention of honoring the contract’s provisions. ABS Global breached the agreement, signed in 2012, when the company sought to avoid meeting some of its contractual obligations, the lawsuit claims. Sexing Technologies is seeking unspecified monetary damages and a ruling by the court that the contract is valid and enforceable. “We consider our customers to be our valued business partners in a relationship built on trust,” said Maurice Rosenstein, Sexing Technologies Co-CEO. “Based on that trust and on the certainty that long-term sorting contracts provide, we invest in sophisticated and expensive semen sorting labs on the customer’s premises to provide the high level of service demanded by the larger bull studs, such as ABS. This is a major commitment on our part, and we take it very seriously. ’We honor our contracts with our customers, and we expect our customers to honor them as well,’” Rosenstein said.

What it boils down to is that ST has been very aggressive in their research but also in limiting the development of competing products.  They have done this either by acquiring patents developed by competing organizations or signing contracts with those who  license their equipment that limit them from developing their technologies.  And that is the crutch in this agreement.  ABS contends that the contract that they signed with ST had provisions that would make it impossible for the development of a competing technology.  Something that ABS has now done.  ST contends that by signing the contract they had access to patented technology that greatly enhanced their ability to develop a competing technology, something that ABS did do.  So it really boils down to the fact of determining if  ABS breached their contract by developing their own technology, or was the contract null and void because  it contained provisions that should never have existed in the first place

The Bullvine Bottom Line

Whether the legal proceedings say it or not, at the heart of the matter is the situation where Sexing Technologies, through intensive research, patent acquisition, and aggressive legal defense of their position has developed a dominant position on the sexed bovine semen sorting business.  This has been a lucrative endeavor for ST as they can charge significant premiums for the use of their technology. Anyone who has ever run a business knows that the way to get the highest premium is to have no direct competitors. This is something ST has been able to achieve.  That’s just plain smart business.  Now ABS is trying to use the US laws that inhibit any company from having a monopoly on an industry to declare the contract null and void that they signed with ST.  Again smart business from ABS because they have to do something in order to decrease the expense and the only way to do so is to make sure there is more than one option available.  US laws are in place to protect consumers from being gouged due to monopolistic behaviors. In reality, you can see arguments from both sides.  ABS Global’s contention that ST has a monopoly on the marketplace would indeed appear valid though ST contends that sexed bovine semen is just a small part of a much larger industry, rather than an industry upon itself.  Sexing Technologies’ contention that ABS Global did not honor their contract and as a result had access to their patented technology that then enabled them to develop their solution also has merit.    So this really comes down to two companies who are doing smart business and trying to use the courts to uphold  their position or, in the case of ABS, remove the monopoly they contend ST has on the sexed bovine semen sorting business.

So, when you look at it objectively, the legal battle between ABS Global and Sexing Technologies are good business strategies. The courts will decide the outcome.




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Sexed Semen from Cool Technology to Smart Business Decision

Sometimes we are guilty of overthinking things.  We talk about corrective mating, line breeding, and developing a distinct bloodline, when in reality nothing makes more dollars and cents than getting more female calves from your best cows.  No matter what your breeding or profit goals are, there is no question that you need to get  your cows back in calf for another lactation and have them  produce enough replacement heifers.  These are two top metrics every dairy must aim for.

There used to be a time when you could burn through young cows, but today’s modern dairy operation is dependent on getting the milking cows back in calf and preferably they will produce 3-4 heifers throughout the course of their lifetime.  I say heifers because recent analysis of 2,390,000 lactation records covering 1,490,000 cows found a clear pattern: Cows produce more milk for their daughters than their sons.  The sex of the first calf is particularly important and can influence how much milk production is generated in future lactations as well.  (Read more: Study Of 1.5 Million Cows Shows Daughters Get More Milk Than Sons) In fact the study found that cows that gestated back-to-back daughters produced as much as 1,000 pounds more milk than those that give birth to sons over the first two lactations.

The effect of sons and daughters on mum's milk production, across two lactations.

The effect of sons and daughters on mum’s milk production, across two lactations. S = son, D = daughter, numbers along x-axis indicate order of pregnancy. Credit: Hinde et al, 2014, PLOS ONE.

Think about this.  For example, this would make a bull thought of as a type sire, such as Regancrest Braxton, who has a PTAT of 3.70 and a  milk proof  of 1516 lbs. into a +2016 lbs. for Milk, when used on a cow that might have produced 2 daughters as compared to 2 sons.  That would rank Braxton among the top 200 proven sires for production (or the top 1% of the breed) and yet he has more than twice the type improvement values of those production sires.

So you say, “Sure that all sounds good, but how do you make it happen?”  Well the answer is pretty simple. “You use Sexed Semen.”  Now for those of you who have a negative opinion of sexed semen.  It probably comes is because you used sexed semen or recall the rumors in the early days when the conception was low, the reliability was poor and the price of semen was high.  In 2014 the reality is that all of the negative factors have changed significantly.  Over the past 10 years the technology behind sexed semen has changed drastically.  Juan Moreno, CEO of Sexing Technologies, (Read more: SEXING TECHNOLOGIES: Gender Vendors in a Changing Marketplace) shared the following stats at the recent Canadian Dairy Xpo (Watch the video here):

  • 1984 to 2000
    Purity Under 80%
    Low Fertility (below 50%)
    1000 doses of conventional semen would produce 200 doses of sexed semen.
  • 2002 to 2012
    85% Purity
    about 80% fertility rate of that of conventional.
    1000 doses of conventional semen would produce 400 doses of sexed semen.
  • Current
    93% Purity
    98% fertility rate of that of conventional.
    1000 doses of conventional semen can now produce 1100 doses of sexed semen.

From a breeder prospective, sexed semen has gone from a costly alternative to a probable alternative for selective situations, to a smart business decision.

One of the things driving the cost down as well is that the equipment that sorts the semen has gone from processing 200 sperm cells per hour to over 100X times that rate per hour.

The math is pretty simple.  In order to justify the extra cost of the semen, the added production alone would more than cover the cost.  And that does not even factor in the increased revenues from having more female calves.  For many breeders who are using sexed semen, they have also started breeding the bottom 10% to beef sires (Read more: Why you should get rid of the bottom 10%).  With beef cull calves in such demand, due to the shortage of beef cattle, the price for these calves has never been higher.  In fact for many herds these bottom 10% of seed stock calves have become a significant income source.  Especially when bred to be sexed male beef semen.

The Bullvine Bottom Line

There is no question that sexed semen has come a long way over the past 20 years and particularly in the last five.  Like most new technologies, it takes a period of time to perfect the science behind the cool new product, and help bring the cost of production down.  Today the cost of production of sexed semen is not nearly as high as it once.  As well, there is new data showing that cows that calve with two successive females produce up to 1,000 more lbs of milk in those 1st two lactations.  It’s clear that sexed semen is worth the investment.


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SEXING TECHNOLOGIES: Gender Vendors in a Changing Marketplace

Predetermined sex in offspring is the brass ring that dairy breeders seek in managing in the ever more competitive marketplace. Most definitely this control is becoming more achievable.  Sexed semen end user price has dropped to one third of the price it was when it was first introduced.

Sexing Technologies (ST) is a well known, worldwide provider of sexed semen and embryos. Juan Moreno, who is co-owner of ST with Maurice Rosenstein, outlines the business that has been built by this company.


Sexing Technologies owes its origin to a company called Genetic Resources International (GRI) which got started 22 years ago as a Custom Semen and Embryo collection facility and Genetics Exporter servicing the Southern US.  While considering expansion into the IVF world 12 years ago.  They discovered that sexed semen, although technologically possible, was not commercially available because it was consider too expensive and of lower fertility and therefore did not have commercial viability. He outlines the steps taken in forming Sexing Technologies. “The partners in the business 11 years ago went heavily into debt to obtain a license from XY Inc., additional partners came into the business and Sexing Technologies started its commercial sexed semen production 10 years ago having Select Sires as its first large commercial customer.”

AT YOUR SERVICE: The Rising Tide of Technology

“Our philosophy is to generate value for the end user.” Explains COCEO Moreno, who is excited about the growing possibilities. “High genetic level bulls are available now. For example the #1 Proven Jersey bull in the world is available in sexed semen. There is every reason for the same to be available in Holsteins. Producers are using sexed semen in both heifers and cows.  Sexed semen has become part of modern management strategies on the farm.”  Today ST sexed semen is in every day use on thousands of farms (both beef and dairy) in 15 countries around the world confirms Sexing Technologies COCEO. “ It is being produced by more than 25 bull studs. Our production is estimated at 10 million straws annually and over 30 million calves have been born.”  The ST co-owner lists five of the many services it provides to breeder customers:

  • As a commercial service we are one of the largest exporters of dairy heifers having shipped over 40,000 animals in two years.
  • We offer custom semen collection services for both conventional and sexed semen and reproductive services in Embryo Transfer and IVF.
  • We process sexed semen in Deer, Elk, Sheep, Goats and soon in Horses and Pigs.
  • We service the industry by progeny testing Holstein, Jersey and Brown Swiss bulls.


Juan speaks with both pride and humility when sharing the growth of Sexing Technologies. “ Today more than 28 families have ownership in Sexing Technologies and the ST family team of over 500 men and women proudly services an industry that feeds the world. We are very thankful to our customers and to the ST team that has provided us with the support to improve the fertility of the product and reduce the cost to the end user.”  What he feels in unique about this undertaking is that the entire team has a common goal. “We believe in team effort and being part of an industry that includes, breeders, farmers, bull studs, breed associations, testing services, researchers and others, all working for a common effort of producing in milk, a nutritious quality product, at a fair price that the end consumer can enjoy.”


Potential users of sexing technology are always hungry for advice from those who have experience. Moreno shares his viewpoint. “ The technology has changed dramatically, especially in the last 5 years. A considerable amount of resources and time has gone into developing new generations of equipment, changing procedures, media improvements and user awareness. For example in the last 5 years we have gone through 5 different new models of sperm sorters, each one an improvement on the previous one. Thus production efficiency has improved considerably and the end user has benefitted by seeing a significant price reduction in the cost for their sexed semen since ST introduced it in the market place 10 years ago.”


It’s important to use sexed semen as part of an overall management strategy on the dairy farm.  It facilitates the allocation of resources by allowing for the selection of higher quality replacement females. It allows you to significantly reduce calving difficulties. It allows for greater income  by marketing extra heifers or even introducing cross breeding with beef bulls to produce a product of a higher value in the market and, most importantly,  fertility is improving.  We are expecting the publication of several articles on large trials ran by independent researchers in different countries corroborating the improved fertility. It’s time to use it for first service in cows.”

“What`s In It For Me?”

With any leading edge tool that requires adapting to change, breeders are concerned about how it can work for them. “That is a tough question.” Asserts Juan Moreno. “Markets are always changing and unpredictable. My crystal ball has failed me many times in the past. However, I do believe that many technologies are coming together at this point” As Moreno looks to the best impact of sexing technologies, he points out 3 specifically.

  1. Sexed semen can be used to generate female only embryos 99% of buyers don’t really care about having bulls. Only bull studs care about the bulls, most breeders would like to improve their female base. Making embryos with conventional semen makes 50% of the resulting product (bulls) non marketable. Produce for the 99% not the 1%.
  2. Genomic testing allows targeting embryo production for different niche makers like higher protein, A2 milk, Show, Polled, Color, Milk, Fertility or Net Merit or TPI.
  3. New Technologies will drive the market to the selection for traits such as fertility, health, feed efficiency, robot adaptability, etc.


A full consideration of sexing technologies must not overlook InVitro Feriliaztion. Moreno provides particularly interesting statistics and suggestions for their use.

  1. 30% of the donors make 80% of the embryos. Don’t keep on trying with low embryo producers.
  2. make an assessment of the marketability or value within your own herd of the resulting offspring 24 months down the road. Don’t measure today expecting to forecast tomorrow.
  3. Producing 90%-95% females gives you a much better chance of maximizing your investment . Almost all females from top donors will have a place in your herd. Only 1% or less  of the bulls born will ever find a home. Therefore the investment does not compensate the return if you continue producing 50% bulls.


According to Juan Moreno, it’s not the technology that floods the market, it’s the users that choose to produce embryos from a higher number of donors. “I believe the success of IVF provides the opportunity to be more selective as to the genetic quality of donors being used. Technologies such as IVF provide the greatest benefit when used only on elite cattle. Maybe the excitement of Genomics has lead to a definition of “Elite” that is too relaxed.”


Moreno suggests definite steps in using IVF. “First and foremost the genetic value of the animal today and a year down the road needs to be evaluated.  The statistical possibility of that donor generating an offspring that will have market viability 18 to 24 months down the road must also be forecasted. Secondly animals must go through a very thorough schedule of vaccinations and heath testing. Donors are then placed on optimized nutritional regimens based on age and reproductive status. Thirdly reproductive examinations and evaluations on the animal are performed prior to her start in the donor program and they are continued through her life as a donor. The most important fourth step is that the animal must be evaluated after the first three aspirations to determine her ability to produce sufficient number of oocytes and embryos to compensate the investment.” Moreno concludes with a key statistic. “Breeders must always keep in mind that 30% of the donors produce 80% of the embryos.”


ST confirms that IVF results are influenced by breed, age of the donor, reproductive status of the donor, aspiration frequency, nutritional status and hormonal treatments. “We favor a more natural and conservative approach with no hormonal treatments. This approach benefits the long term well being of the animal. In Bos Indiscus breeds like Brahman we average over 7 embryos per aspiration and on Holstein cows  3.3 embryos per aspiration, dropping to 2.2 embryos in heifers. Embryo pregnancies depending on the time of the year range from 43% to 55%.”


ST has been doing IVF for more than 10 years and embryo transfer since the original company was created 20 years ago. ST operates 2 IVF labs in Brazil and 4 in the United States. Two of the US labs are operated as Research and Development laboratories which have been fundamental in testing procedures for sexed semen, leading to a series of improvements in the process that have lead to increased fertility in sexed semen.


“We dedicate a considerable amount of funds and resources to Research and Development in Animal Reproduction from heat detection devices, estrus synchronization technology, sexed semen, in vitro fertilization and genetic development programs.” reports Moreno adding that, “  A great deal of emphasis is being dedicated to genetic advancement programs researching new economically significant traits for which prior genetic pressure has not been applied.”


Once again as breeders, we are being urged to recognized that putting different technology tools together can provide advantages that they couldn’t deliver alone. Moreno says the list is long on the technologies  and we should look at in combination. “Some of the technologies have been around for a long time but they will become more relevant in the future because, when paired with new technologies, they lead to greater value.  For example: Genomics, Embryo Transfer, IVF, Sexed Semen, Robot Milkers, compliance data systems, Universal Animal Identification, Gene identification , they all have to lead to milk being produced in a more efficient manner so that dairying can be a profitable business for generations to come.”


Technology is not a tool that you can choose to do without. As is always the case with technology driven evolution those who choose to ignore it may be ignoring their own sustainable business. Sexing Technologies is on the leading edge. At the end of the dairy day, those who readily and effectively adapt to the “new world” will succeed and those who don’t won’t!


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