The costs of production diseasesHenk Hogeveen
Who am I Farm boy (dairy farm, 45 cows) Animal science at Wageningen Univesity     ● Epidemiology (simulation model of m...
In the old days .... Things were different (better?) Authority Fixed prices Hardly any competition You did what you l...
Currently Competition     ● Between vets     ● From others Well educated farmers No fixed prices Agricultural prices u...
Result …. Farmers management is more and more aimed at optimization of health, not maximisation of health Vets function ...
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
Farm production    Milk output (Q)                      Farm with fixed land and                      buildings (constrain...
Effect of disease -More resources for same production -Less production with same resources -optimal level of production ch...
What’s the point? Production function differ from farm to farm, dependent on:    ● Management skills    ● Farm seize    ●...
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
Economic effects of diseases Economic effects = losses + expenditures Losses (decrease in production)    ● Decreased pro...
Introduction   Optimization of expendituresLosses                  and losses                                Expenditures
Disease treatments Treatment of clinical cases is an expenditure     ● Used to optimize total losses     ● Studies on opt...
How to study economics of prevention? Start with costs of disease (failure costs)     ● Losses     ● Associated expenditu...
Introduction               Benefits exceed costsFailurecosts                        Old situation          Benefits       ...
Introduction        Costs exceed benefitsFailurecosts                        Old situation            Benefits            ...
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
Recent literature (€)                         Bar    Halasa   Hagnestam-Nielsen   Huijps                         2008   20...
Research Default cost calculations     ● Based on literature and expertise     ● Clinical mastitis: Yearly incidence     ...
Theory vs practise (€/cow/year)                                                 Farm specific                             ...
Theory vs practise (€/cow/year)                                                 Farm specific                             ...
Total costs of mastitis Failure costs + expenditures preventive measures Questionaire dataset of 189 farms     (Santman-...
Preventive measures Cleaning cubicles Cleaning lanes Drying off Pre-stripping Clean dirty udders Milker gloves Clea...
Total costs mastitis (€/cow)                                      5%          95%                                   percen...
Failure costs vs preventive costs
Cost-effectiveness of preventive measures  -18 management measures (Huijps et al., 2010)     -Quantify effect     -436 sci...
Additional    Reduced                                                              expenditures   losses    Net benefitMil...
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
A healthy claw
Different foot disorders             Sole haemorrhages             and             White line disease                     ...
Simulation model                           No foot disorder,                             healthy (H)       PSH        PHS ...
Modelling assumptions Assumptions (Dutch circumstances):     ● cubicle housing     ● concrete floor     ● pasturing     ●...
Add consequences to simulation model                                                No foot disorder,                     ...
Economic effectsTotal costs (default input, The Netherlands)Per farm (65 cows)   : €3,474 per year (€2,282 to €4,965)Per c...
Cost components                            Visit of veterinarian                                                    Treatm...
Differences between farms (€/cow/year)Parameter                              Average   min – maxLosses of decreased milk p...
Differences between farms (€/cow/year)Parameter                              Average   min – maxLosses of decreased milk p...
Preventive measures Measures:     ● Additional foot trimming     ● Feeding management     ● Feed supplements     ● Floor ...
Costs and benefits                                  Costs      Benefits1    Net costsIntervention measure            (€/co...
Net costs vs welfare                  6                  5                            Lymat                  4            ...
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
Background of study Stochastic model Herd level (65 dairy cows) Input based on literature
Cost of ketosis                             Average: € 1778 per farm/year                             Variation: € 1588 – ...
Metabolic disorders No other estimates in scientific literature Other estimates are made     ● Consultants     ● Doubtful
Outline Production economics Cost factors of production diseases Production diseases   ● Mastitis   ● Claw health   ● M...
Only three production diseases What about  ● Young stock raising  ● Culling policy  ● Reproductive management  ● ……….
Under estimation of costs by farmers                       200                       180                       160        ...
Youngstock raising (€ per heifer)  Our calculated costs:                                         € 1.540 (Mohd Nor et al.,...
Herd health programs Herd health & management programs are aimed at improving herd situations Knowledge of economics is ...
There is more than economics Attitude explains mastitis situation (Jansen et al., 2009) Campaigns do have an influence (...
Economics to support decisions Production diseases costs much money     ● Most expensive cattle disease present     ● Cos...
Thank you for your attention
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Economics of production diseases, WBS2012, Lisbon

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Economics of production diseases, WBS2012, Lisbon

  1. 1. The costs of production diseasesHenk Hogeveen
  2. 2. Who am I Farm boy (dairy farm, 45 cows) Animal science at Wageningen Univesity ● Epidemiology (simulation model of management around cystic ovaries) ● Economics (long term effect of herd health management programs) PhD at Vet Medicine (AI programs to diagnose mastitis) Working in field of animal health management In between Wageningen University and Faculty of Vet. Med. ● @henkhogeveen ● animal-health-management.blogspot.com
  3. 3. In the old days .... Things were different (better?) Authority Fixed prices Hardly any competition You did what you liked
  4. 4. Currently Competition ● Between vets ● From others Well educated farmers No fixed prices Agricultural prices under under pressure (free markets)
  5. 5. Result …. Farmers management is more and more aimed at optimization of health, not maximisation of health Vets function on equal level: discussion instead directive One additional argument: money So, vets need to know about economics of disease and economics of management
  6. 6. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks
  7. 7. Farm production Milk output (Q) Farm with fixed land and buildings (constraints): Output is a function of input Resource input (R)
  8. 8. Effect of disease -More resources for same production -Less production with same resources -optimal level of production changes as well Milk output (Q) I Resource input (R)
  9. 9. What’s the point? Production function differ from farm to farm, dependent on: ● Management skills ● Farm seize ● Intensity ● ….. And …. ● Effects of disease differ from farm to farm ● Effects of disease differ based on prices
  10. 10. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks
  11. 11. Economic effects of diseases Economic effects = losses + expenditures Losses (decrease in production) ● Decreased production level ● Discarded milk ● Changes in milk price (milk quality) ● Culling Expenditures (additional resources) ● Drugs ● Veterinarian ● Labour ● Preventive measures
  12. 12. Introduction Optimization of expendituresLosses and losses Expenditures
  13. 13. Disease treatments Treatment of clinical cases is an expenditure ● Used to optimize total losses ● Studies on optimal treatment are made e.g. Steeneveld et al., 2011; 2007, Swinkels et al., 2005a; 2005b But in prevention, treatment is seen as part of costs of a case (failure) Therefore we optimize Failure costs vs Preventive measures
  14. 14. How to study economics of prevention? Start with costs of disease (failure costs) ● Losses ● Associated expenditures (treatments etc) ● Quite some information is known Calculate costs of prevention ● Investments ● Expdenditures ● Labour (value?) ● Relative straightforward work Estimate economic improvement ● Difference between old and new situation ● Difficult !!!
  15. 15. Introduction Benefits exceed costsFailurecosts Old situation Benefits New situation Costs Preventive measures
  16. 16. Introduction Costs exceed benefitsFailurecosts Old situation Benefits New situation Costs Preventive measures
  17. 17. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks Based on work of: Huijps et al., 2008, 2010 Hogeveen et al., 2010 van Soest et al., 2011
  18. 18. Recent literature (€) Bar Halasa Hagnestam-Nielsen Huijps 2008 2009 2009 2008Level Cow Cow Cow-year CowMilk production losses - 11 78 36Labour - 11 - 4Treatment - 14 - 15Culling - 46 - 22Death - 0 - 0Veterinarian - 2 - 1Milk quality - 0 - 0Materials - 0 - 0Diagnostics - 0 - 0Total 61 84 97 78
  19. 19. Research Default cost calculations ● Based on literature and expertise ● Clinical mastitis: Yearly incidence ● Subclinical mastitis: Bulk milk somatic cell count ● Conservative estimations Data collection ● 64 dairy farms ● Data entry at “open farm days” ● Assistance from researcher
  20. 20. Theory vs practise (€/cow/year) Farm specific Default Mean Low HighProduction losses subclinical 16 36 6.8 72.4Production losses clinical 23 10 2.5 22Veterinarian (€/cow/year) 0.3 0.6 0 2.5Drugs 6 10.6 3.5 26.7Discarded milk 9 7.9 2.5 17.9Culling 22 17.9 0 46Penalties 0 0.30 0 2.4Labour 4 3.8 0 15Total economic losses 81 78 31.4 153.8
  21. 21. Theory vs practise (€/cow/year) Farm specific Default Mean Low HighProduction losses subclinical 16 36 6.8 72.4Production losses clinical 23 10 2.5 22Veterinarian (€/cow/year) 0.3 0.6 0 2.5Drugs 6 10.6 3.5 26.7Discarded milk 9 7.9 2.5 17.9Culling 22 17.9 0 46Penalties 0 0.30 0 2.4Labour 4 3.8 0 15Total economic losses 81 78 31.4 153.8
  22. 22. Total costs of mastitis Failure costs + expenditures preventive measures Questionaire dataset of 189 farms (Santman-Berends et al., 2011) ● General questions ● Livestock management ● Lactating cows ● Milking process ● Feed Pathogens and clinical mastitis on 120 farms MPR data Calculations of failure costs clinical mastitis, subclinical mastitis
  23. 23. Preventive measures Cleaning cubicles Cleaning lanes Drying off Pre-stripping Clean dirty udders Milker gloves Clean cluster after clinical case Milk high SCC cow last Post milking teat disinfection Fixing cows after milking
  24. 24. Total costs mastitis (€/cow) 5% 95% percentile percentile AverageClinical mastitis 62 16 151Subclinical mastitis 14 9 21Failure costs mastitis 76 26 164Prevention costs 88 43 131Costs of masitits 164 99 281
  25. 25. Failure costs vs preventive costs
  26. 26. Cost-effectiveness of preventive measures -18 management measures (Huijps et al., 2010) -Quantify effect -436 scientific papers (1996-2006) -43 relevant and useful - Expert sessions -Effect 100 % contagious -Effect 100 % environmental -Efffect on BMSCC -Efffect on clinical mastitis
  27. 27. Additional Reduced expenditures losses Net benefitMilk cows with clinical mastitis last 37 16 -21Milk cows with subclinical mastitis last 104 20 -84Use of separate cloths during udder preparation 26 9 -17Wash dirty udders during udder preparation 3 9 6Prestripping 34 9 -25Use of milkers’ gloves during milking 1 9 8Post milking teat disinfection 31 31 -0Back-flushing clusters after milking a cow with clinicalmastitis 1 11 10Back-flushing clusters after milking a cow with subclinicalmastitis 123 15 -108Replace teat cup liners in time 13 11 -2Use of a treatment protocol 7 15 8Application of blanket dry cow therapy 9 36 27Keep cows standing after milking 2 12 10Feed additional dry cow minerals 13 13 0Prevent overcrowding 23 13 -10Clean boxes 54 15 -39Clean yards 51 8 -43Optimize feed ration
  28. 28. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks Based on work of: Bruijnis et al., 2010; 2012 Verhoef, 2012
  29. 29. A healthy claw
  30. 30. Different foot disorders Sole haemorrhages and White line disease Interdigital dermatitis/ heel horn erosion Interdigital hyperplasia Digital dermatitisSole ulcer (corns, tyloma) (Mortellaro’s disease) Interdigital phlegmon
  31. 31. Simulation model No foot disorder, healthy (H) PSH PHS PHC PCH Subclinical foot PSC Clinical foot disorder disorder (S) (C) PCU L Culled (Cul)
  32. 32. Modelling assumptions Assumptions (Dutch circumstances): ● cubicle housing ● concrete floor ● pasturing ● two foot trimming interventions/year 7 different foot disorders
  33. 33. Add consequences to simulation model No foot disorder, healthy (H) PSH PHS PHC PCH Subclinical foot PSC Clinical foot disorder disorder (S) (C) PCU L Culled Economic consequences: Economic consequences: (Cul) - Milk production losses - Milk production losses - Prolonged calving - Prolonged calving interval interval - Labor dairy farmer- Welfare impact: - Costs foot trimmer - Estimated pain - Costs veterinarian Economic consequence: - Treatment - RPO-value - Discarded milk - Welfare impact: - Estimated pain
  34. 34. Economic effectsTotal costs (default input, The Netherlands)Per farm (65 cows) : €3,474 per year (€2,282 to €4,965)Per cow : €53 per cow/year Costs of subclinical foot disorders: 32% Average clinical foot disorder: €67/case Average subclinical foot disorder: €13/case Digital dermatitis gave highest costs (high incidence, high clinical prevalence)
  35. 35. Cost components Visit of veterinarian Treatment Visit of foot trimmer Discarded milk Labour of the dairy farmer Milk production losses Prolonged calving interval Culling
  36. 36. Differences between farms (€/cow/year)Parameter Average min – maxLosses of decreased milk production 20 10.3 – 24.3 Clinical 14 8.0 – 19.1 Subclinical 6 2.3 – 12.4Losses of discarded milk 0.3 0 – 1.7Losses of prolonged calving interval 7 3.7 – 9.6 Clinical 5 2.7 – 6.3 Subclinical 3 1.0 – 4.0Losses of advanced culled cows 8 0 – 27.8Cost of treatment 9 1.0 – 18.2Total costs 45 23.1– 60.4
  37. 37. Differences between farms (€/cow/year)Parameter Average min – maxLosses of decreased milk production 20 10.3 – 24.3 Clinical 14 8.0 – 19.1 Subclinical 6 2.3 – 12.4Losses of discarded milk 0.3 0 – 1.7Losses of prolonged calving interval 7 3.7 – 9.6 Clinical 5 2.7 – 6.3 Subclinical 3 1.0 – 4.0Losses of advanced culled cows 8 0 – 27.8Cost of treatment 9 1.0 – 18.2Total costs 45 23.1– 60.4
  38. 38. Preventive measures Measures: ● Additional foot trimming ● Feeding management ● Feed supplements ● Floor hygiene (scraper, robot, manual) ● Foot bath ● Improved lying surface of cubicles (straw, mattrass) ● Rubber flooring ● Reduce overstocking Effects based on scientific literature (if available) and expertise
  39. 39. Costs and benefits Costs Benefits1 Net costsIntervention measure (€/cow/yr) (€/cow/yr) (€/cow/yr)Additional foot trimming 7 8 -1Feeding management 34 5 29Feeding supplement 20 3 17Floor hygiene, manure scraper 25 12 14Floor hygiene, manure robot 39 12 27Floor hygiene, manual 56 12 45Foot bath 34 3 31Lying surface, bedding 19 19 -1Lying surface, mattress 13 19 -7Rubber flooring 28 11 17Stocking density 16 17 0
  40. 40. Net costs vs welfare 6 5 Lymat 4 LybedWelfare benefit Stdens 3 Rubfl Hygrob Hygscr Hygman 2 Ftrim Feedman 1 Feedsup Fbath 0 -10 0 10 20 30 40 50 Net costs (€)
  41. 41. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks Based on work of: Woolderink et al., 2002
  42. 42. Background of study Stochastic model Herd level (65 dairy cows) Input based on literature
  43. 43. Cost of ketosis Average: € 1778 per farm/year Variation: € 1588 – 3506 78 16 6 120 Clinical: € 361 per case Subclinical: € 73 per case 807 Milk production Culling 751 Mastitis Treatmet LDA Calving interval
  44. 44. Metabolic disorders No other estimates in scientific literature Other estimates are made ● Consultants ● Doubtful
  45. 45. Outline Production economics Cost factors of production diseases Production diseases ● Mastitis ● Claw health ● Metabolic disorders Final remarks
  46. 46. Only three production diseases What about ● Young stock raising ● Culling policy ● Reproductive management ● ……….
  47. 47. Under estimation of costs by farmers 200 180 160 140 Real costs (€/cow) 120 100 80 60 46 under 40 Mastitis estimators!!!!! 20 0 0 20 40 60 80 100 120 140 160 180 200 Expected costs (€ per cow)
  48. 48. Youngstock raising (€ per heifer) Our calculated costs: € 1.540 (Mohd Nor et al., 2012 Farmers estimates: Total costs: € 1.559 (800 – 2.862) Without labour € 1.121 (532 – 1.764) Without labour and housing: € 879 (319 – 1.477) Accuracy of farmers estimation € 1.500,00 Difference between estimation € 1.000,00 and real costs (euros) € 500,00 € 0,00 -€ 500,00 -€ 1.000,00 -€ 1.500,00 -€ 2.000,00
  49. 49. Herd health programs Herd health & management programs are aimed at improving herd situations Knowledge of economics is then essential Improvement of disease situation improves value of herd health programs (see work of Derks et al., 2012)
  50. 50. There is more than economics Attitude explains mastitis situation (Jansen et al., 2009) Campaigns do have an influence (Jansen et al., 2010) Cost factors are not regarded as being equal (Huijps et al, 2009) Sometimes farmers behave irrational (Huijps et al., 2010)
  51. 51. Economics to support decisions Production diseases costs much money ● Most expensive cattle disease present ● Costs are often failure costs ● Total costs (including prevention) are much higher ● Differences and underestimation between farmers -> farm specific calculations More than only money to motivate farmers Decision support is weighing costs of prevention vs reduction of failure costs ● That is up to you, veterinarians!!! ● Tool on www.bec.wur.nl -> research -> decision support tools
  52. 52. Thank you for your attention
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