Worldwide purebred dairy cattle breeders account for less than 1% of the dairy farmers. Purebred Holstein breeders account for around 20% of the Holstein cattle in the USA and about 17% of the total dairy cattle in the USA. However, if you were to read any of the media, or discussion groups among breeders, you would think that purebred breeders were closer to 90%.
This disconnect was once again made obvious to me yesterday, when I posted a simple question “Do you think there will be any more Millionaire Sires?” which referenced an article we wrote back in September by the same name. While the topic generated over 200 comments in under 12 hours, what was most telling was the perspective that revealed how long many breeders believed it would take for a sire to achieve such a lofty number. The one point that came through loud and clear was that the average pedigree breeder has an inflated sense of how much semen market share they actually account for.
Trust me I understand that we can all be guilty of having an inflated ego. Some of us…read that as I, have a bigger ego than must. However, even I can realize how little of the semen market share the pedigree sector actually accounts for.
There are approximately 115 million dairy farms in the world. India and Pakistan account for 89 million of those dairy farms although, at an average herd size of less than five cows; these two countries are mostly irrelevant from a dairy cattle breeding perspective (although some of The Bullvine’s competitors would argue differently if you look at their Facebook followers’ profile (Read more: The Truth about Dairy Genetics Publications Facebook Fan Page Statistics). As far as worldwide dairy cattle genetics are concerned, specifically semen sales, the principal markets, based on the number of dairy cattle, average herd size, and total production per cow, are: as follows:
- United States of America
- New Zealand
- United Kingdom
When you look at these ten countries that account for 51.1% of the world’s milk production (68% if you exclude India and Pakistan), one of the key points that stands out is that the average herd size in most of these countries is well over 100 cows.
United States dairy cows stats show that the average herd size on dairy farms is 167 milking cows. The majority (74%) of U.S. dairy farms have less than 100 cows. Farms with more than 100 cows produce 85% of the milk. So while the majority of dairy farmers in the USA are relatively smaller herds, the large majority of the cattle and milk production are associated with large commercial herds.
When you are looking at semen sales, this is a very telling statistic. This shows that in order to move mass amounts of semen, like 1,000,000 doses, a sire needs to be used extensively in the large herd market.
It is purely a numbers thing. With almost 90% of the US dairy cattle population accounted for in the herds that are over 100 cows, in order for a sire to sell 1,000,000, he is going to need to be popular in that market sector. This is especially true given today’s high sire turnover genomic era. The opportunity to reach Millionaire status may exist for the odd sire to do it, such as the type specialist Atwood but he will be the last type sire that will ever have a chance to do so. However, as we demonstrated in the article (Read more: Do you think there will be any more Millionaire Sires?), the majority of today’s sires will be lucky to hit 500,000 in total sales.
What was shocking to me when I followed the discussion on the Milk House, was the number of purebred breeders who were throwing out niche type bull after niche type bull that could possibly achieve this lofty mark. Unless the large commercial herds have the worst conception rates known in the world, there are just not enough potential inseminations for type niche sires to ring the bell. As one member of the forum points out “More units of semen get dropped on the ground behind commercial cows daily than a small registered herd would use of that bull.”
Taking these metrics one step further, the show side of the dairy cattle breeding industry, something I love as much as anyone, accounts for less than 1% of the semen marketplace. By my calculations, less than 1/100 % of purebred breeders exhibit at World Dairy Expo, The Royal or other major dairy cattle show. Although the show segment accounts for almost 50% of the media coverage by the major dairy cattle breeding publications, it is relatively small potatoes when it comes to semen market share. From the A.I. perspective the show/type side of the marketplace is high blend price. It is also more costly to market to as these breeders are more of a sire by sire, mating by mating, purchase than a bulk semen or A.I. company loyalty purchase. This means it’s an expensive segment to attract and sell to. Hence why you see so many A.I. companies focusing on the 26% of US dairy farms that account for 85% of the dairy cattle. Heck, even Semex, the A.I. company that has produced the most sires that have sold more than 1 million doses (12) has changed their focus from a niche type market towards this much larger segment (Read more: Semex – The Rise and Fall of a Semen Empire and Select Sires vs. Semex – A Contrast in Cooperatives).
I find this issue to be especially relevant when I look at many of the boards that make decisions for the dairy cattle breeding industry, specifically breed associations. The vocal minority are not afraid to express their opinions and they are often the ones elected to the boards of some A.I. companies and most breed associations. This leads to a slant, especially at breed associations, toward their small group. So instead of focusing on the majority of the milk production market segment, these boards focus on a small niche and find themselves scrounging for relevance.
The Bullvine Bottom Line
Those who consider themselves dairy cattle breeders love to talk about the latest sire or what cow won which show. But it is important to remember they are of limited relativity to the semen market as a whole. They are a very niche segment. Yes, it’s a very vocal segment and accounts for a much larger portion of the conversation than the 26% of milk producers who account for 85% of the production. Nevertheless, the fact remains, it is still a small but vocal minority.