economics of animal diseases
DESCRIPTION
These are the slides of a presentation I was invited to give at the Cattle Association of Veterinary Ireland (CAVI) at their annual conference, held in Galway, Ireland. The presentation deals with economics of production diseases.TRANSCRIPT
Economics of disease
Henk Hogeveen
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 managementIn between Wageningen University and Faculty of Vet. Med.
●@henkhogeveen
●animal-health-management.blogspot.com
Current trends
Farmers management is more and more aimed at optimization of health, not maximization of health
Vets function on equal level: discussion instead directive
One additional argument: money
….. vets need to know about economics of disease and economics of management
Outline
Economics of disease
Production diseases
●Mastitis
●Reproduction
Final remarks
Resource input (R)
Milk
out
put
(Q)
Farm production
Farm with fixed land and buildings (constraints):
Output is a function of input
Resource input (R)
Milk
outp
ut
(Q)
Effect of disease
-More resources for same production
- Less production with same resources
- optimal level of production changes as well
I
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
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
IntroductionLosses
Expenditures
Optimization of expendituresand losses
Disease treatments
Treatment of clinical cases is an expenditure
●Used to optimize total losses
●Studies on optimal treatment are availablee.g. Steeneveld et al., 2011; 2007, Swinkels et al., 2005a; 2005b
But for prevention, treatment is seen as part of costs of a case (failure)
Therefore we optimize Failure costs vs Preventive measures
How to study economics of prevention?
Start with failure costs of disease●Losses●Associated expenditures (treatments etc)●Quite some information is known
Calculate costs of prevention ●Investments (depreciation & intrest)●Expdenditures●Labour (value?)●Relative straightforward work
Estimate economic improvement●Difference between old and new situation●Difficult !!!
IntroductionFailure
costs
Preventive measures
Old situation
New situation
Benefits
Costs
Benefits exceed costs
IntroductionFailure
costs
Preventive measures
Old situation
New situationBenefits
Costs
Costs exceed benefits
Modelling to estimate effects of diseases and disease control
Simulation model
Input data based on data, literature, expertise
Relatively cheap
Pragmatic approach
Bio-economic modelling: economics combined with detailed physiological basis
Models ……. do not capture the complexity of the real situation
Models……. are sometimes too good to be true
Outline
Production economics
Production diseases
●Mastitis
●Reproduction
Final remarks
Based on work of:
Huijps et al., 2008, 2010Hogeveen et al., 2010van Soest et al., 2011
Recent literature (€)
Bar
2008
Halasa
2009
Hagnestam-Nielsen
2009
Huijps
2008
Level Cow Cow Cow-year Cow
Milk production losses - 11 78 36
Labour - 11 - 4
Treatment - 14 - 15
Culling - 46 - 22
Death - 0 - 0
Veterinarian - 2 - 1
Milk quality - 0 - 0
Materials - 0 - 0
Diagnostics - 0 - 0
Total 61 84 97 78
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
Irish data (geary et al., 2013)
Theory vs practise (€/cow/year)
DefaultMean Low High
Production losses subclinical 16 36 6.8 72.4
Production losses clinical 23 10 2.5 22
Veterinarian (€/cow/year) 0.3 0.6 0 2.5
Drugs 6 10.6 3.5 26.7
Discarded milk 9 7.9 2.5 17.9
Culling 22 17.9 0 46
Penalties 0 0.30 0 2.4
Labour 4 3.8 0 15
Total economic losses 81 78 31.4 153.8
Farm specific
Theory vs practise (€/cow/year)
DefaultMean Low High
Production losses subclinical 16 36 6.8 72.4
Production losses clinical 23 10 2.5 22
Veterinarian (€/cow/year) 0.3 0.6 0 2.5
Drugs 6 10.6 3.5 26.7
Discarded milk 9 7.9 2.5 17.9
Culling 22 17.9 0 46
Penalties 0 0.30 0 2.4
Labour 4 3.8 0 15
Total economic losses 81 78 31.4 153.8
Farm specific
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
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
Total costs mastitis (€/cow)
Average
5% percentile
95% percentile
Clinical mastitis 62 16 151
Subclinical mastitis 14 9 21
Failure costs mastitis 76 26 164
Prevention costs 88 43 131
Costs of masitits 164 99 281
Failure costs vs preventive costs
- 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
Cost-effectiveness of preventive measures
Additional
expenditures
Reduced
losses Net benefit
Milk cows with clinical mastitis last 37 16 -21
Milk cows with subclinical mastitis last 104 20 -84
Use of separate cloths during udder preparation 26 9 -17
Wash dirty udders during udder preparation 3 9 6
Prestripping 34 9 -25
Use of milkers’ gloves during milking 1 9 8
Post milking teat disinfection 31 31 -0
Back-flushing clusters after milking a cow with clinical mastitis 1 11 10
Back-flushing clusters after milking a cow with subclinical mastitis 123 15 -108
Replace teat cup liners in time 13 11 -2
Use of a treatment protocol 7 15 8
Application of blanket dry cow therapy 9 36 27
Keep cows standing after milking 2 12 10
Feed additional dry cow minerals 13 13 0
Prevent overcrowding 23 13 -10
Clean boxes 54 15 -39
Clean yards 51 8 -43
Optimize feed ration 24 13 -11
Outline
Production economics
Cost factors of production diseases
Production “diseases”
●Mastitis
●Reproduction
Final remarks
Based on work of:
Inchaisri et al., 2010, 2011, 2012
Two decisions around reproduction
When do I start with inseminations
When do I stop with insemination
Difficult calculation
Cow factors
●First ovulation
●Probability of detection
●Probability of conception
●Milk production level
●Reproductive disorders
Economical factors
●Milk price
●Costs of insemination
●Costs of culling
●Costs of calving management
31
A complexsystem of
dynamics andinteractions
Stochastic dynamic modelling
• Breed
• Parity
• Month of calving
• Milk production
• Farm level
• Relative performance
• Persistence
Cow
START OF CYCLE
33
Calf
Ovulation
Oestrusdetected
Insemination
Conception
yes
yes
yes
yes
no
no
no
no
cow
Probabilitiesbased on cow
factors
Average results
Voluntary waiting periods
6 wk 7 wk 9 wk 11 wk 13 wk 15 wkFirst insemination
10.9 11.5 13.1 14.8 16.8 18.5Calving interval
391 393 401 410 421 433MP/cow/year (kg)
8200 8188 8157 8112 8056 7997Insemations
1.89 1.86 1.78 1.74 1.70 1.69Calves/cow/year
0.93 0.93 0.91 0.89 0.87 0.84
Not pregnant (%) 0.018 0.019 0.021 0.025 0.030 0.037
34
Average
0
10
20
30
40
50
60
6 7 8 9 10 11 12 13 14 15VWP (weeks)
Net
loss
es (
€/co
w/y
ear)
Economic consequences (€/cow/year)
Voluntary waiting periods
7 wks 9 wks 11 wks 13 wks 15 wksMilk production
2.2 8.9 18.3 32.4 46.4
Calves 0.1 0.3 0.6 1.0 1.7
Culling 0.4 1.6 3.4 6.3 10.1
Inseminations -0.5 -1.6 -2.0 -2.8 -3.1
Calf Management
-0.1 -0.5 -1.0 -1.8 -2.9
Net total 2.1 8.6 19.0 34.2 52.2 (-16-22) (-11-32) (-6-53) (4-78) (13-106)
36
But 6 weeks not always optimal37
0
5
10
15
20
25
30
35
40
6 7 8 9 10 11 12 13 14 15
Per
cent
age
cow
s
Optimal VWP (wks)
Longer VWP when ….
Cow factors
●Parity = 1●Not Holstein Frisian●High persistence●Low production●Late peak in production●Calved in winter●Bad oestrus detection●Late first ovulation●Reproduction diseases
Economical factors
●Lower costs low milk production
●High costs of inseminations
●High costs culling
38
Outline
Production economics
Cost factors of production diseases
Production diseases
●Mastitis
●Metabolic disorders
Final remarks
Only two production diseases
What about
●Young stock raising
●Culling policy
●Claw health
●Metabolic diseases
●……….
Under estimation of costs by farmers
0
20
40
60
80
100
120
140
160
180
200
0 20 40 60 80 100 120 140 160 180 200
Expected costs (€ per cow)
Rea
l co
sts
(€/c
ow
)
46 under estimators!!!!!Mastitis
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)
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)
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.wageningenur.nl/bec -> research -> decision support tools
Thank you for your attention
@henkhogeveen
animal-health-management.blogspot.com
On-line courses on Veterinary Economics on:
www.elevatehealth.eu