Episode 11 (Season 02) - Summer Special - New Zealand Edition

The majority of dairy cows in New Zealand are crossbred. This “national herd” consists primarily of Friesian x Jerseys. However, over the last four years, VikingRed has become the number one option for farmers looking to boost their crossbreeding with healthier, more robust genetics.

 But why is crossbreeding dominant in New Zealand? And what are the main traits farmers aim for? 

 To learn more, we sat down for an informal, improvised chat with a local expert on New Zealand’s unique dairy farming industry, crossbreeding and genetic trends, and other things Kiwi farmers should be on the lookout for.

 Guests:
Jim Bruce, Country Manager for Australia & New Zealand at VikingGenetics

Host:
Hielke Wiersma

Transcript

0:10

All right. So with us is Jim Bruce from Australia. And Jim is responsible for our New Zealand market as well. Jim is here in Denmark and we are recording these podcasts today and we saw the opportunity to invite Jim for a talk about the New Zealand market. It's improvised, so we don't really know where it's heading and how long it will take. But we'll take it as we go. We've talked about to cover an overview of New Zealand for potential listeners and to have a chat about what's going on and what's cooking in New Zealand. Welcome to this extra episode, Jim Thank you, Hielke. It's great to be here and I don't mind being accosted in the hallway and dragged into the studio. That's perfect. Perfect. So, Jim, well, first of all, explain a bit about what you do in Australia. So, I’m the country manager for Australia, we have a subsidiary business of VikingGenetics that's been operating for 12 years. And in addition to that, and where we're heading in this conversation is I'm also responsible for sales in New Zealand, which we do through our distributor there, Samen NZ, and we've been working with Samen NZ now for some four years. I think it is. And yeah, they are a high quality distributor, they're enthusiastic, energetic, innovative and whilst they're selling our product, they've been terrific for me in my role because I've been able to learn from them. It's not just we sell them products, but it's a two way street. They've taught me quite a lot and give me great ideas. All right. So lots of stuff is going on in New Zealand. Explain a little about the New Zealand market. How does it work? What is the New Zealand dairy market? So the New Zealand dairy market is actually over, I would say the last 15-20 years has grown significantly in the number of cows in our setting up around 6 million cows when I first paid attention to New Zealand earlier in my career, there were a lot of Angus cows and there was a dairy industry. And now the dairy industry dominates cow numbers in New Zealand. They've actually displaced a lot of those beef cattle, which... probably a fun fact that I've learned recently from working with Samen just how much growth they've had. So the breed make up of that 6 million or so cows is a few hundred thousand Holsteins, a few hundred thousand Jerseys, about 100,000 or so red cattle predominantly Ayrshire and then the rest crossbreds where the dominant pattern I guess in that is Holstein Jersey Cross and the dominant player in the semen market is the local cooperative LIC, Livestock Improvement Company. And they've been actively encouraging farmers there into cross breeding for quite some time. Do you know why that crossbred between a Friesian Jersey has become so popular in New Zealand? That's a really good question. I think that the traits they really like in those cattle, they’re compact in size. They do like those cattle to be compact and lighter on their feet, lighter in the pasture. And that the combination of including the Holstein of course brings a lot more production. So it's a happy compromise. But as is often the case with a lot of these things, you know, there's room for improvement. And that's been the opportunity that Samen has introduced VikingGenetics into, and that is to approach those farmers and say, Look, we've got an idea where you introduce a third breed and the VikingRed has been the perfect third breed to be the bridge between Holstein and Jersey because they're two quite different types and the VikingRed fits very well for us around the world. We talk about GoldenCross and you know, we're accumulating the science and the reports and the results and the customer feedback from that all over the place. Yeah. I think it's very interesting the fact that the majority of the cows in New Zealand are in fact crossbred because if we look at, you know, other major dairy producing countries, Western Europe, the US, all of these countries they're purebred and they're purebred mainly. Then we have, you know, Ireland is a bit more, the UK is a bit more cross-breeding as well. But in general the majority in those countries, the breeds that they use, the cows that they milk are purebred. Why is that different, do you think, in New Zealand? Well, I think... And again, this is what I've observed. I think there is we see it in Australia as well when people need to get more cattle, the purebreds aren't available necessarily. And so quite often coming from a Holstein cow there are Jersey cross calves because they're using Jersey for calving ease on those Holstein cows. And for a lot of people with a Holstein herd, they're not that interested in the crossbreds, so they become a rich source of alternative dairy cattle for people in a market where the numbers are growing. So I think in Australia I think they're probably looked at as a cheaper source of new dairy cattle to come in. I don't know if that's the case, I don't know the economics of it, but certainly it's a pipeline of new cattle in a growing market such as New Zealand. So that to me would be a big part of it. And I think as I've said, the compromise between those two types has worked well in that environment. It's a grass environment, it's a walking environment, it's a wet environment for a lot of the comparison to a lot of places. Seasonal calving environment. Very tight seasonal calving. And I think, you know, we've all seen in crossbreeding programs the trait that gets the biggest boost or the most significant boost economically is fertility. And so in a very tight seasonal calving industry as is New Zealand, that would be a critical consideration for them too. Can you put into reference for us the impact it has if you don't have that tight block of calving in New Zealand, what's the impact for the farmer? I know from a semen company perspective outside of that window it's all over, baby. It's all over because it is really tight across most of the industry. There will be some autumn calving and I don't know whether that's entirely by design or just cows that miss and are retained. Because the other parts would be spring calving so utilizing the grass utilizing the peak production of the grass. Spring is the big breeding season and it is absolutely all about grass production because their production base is all about grass. It has to be done in a manner that suits... that's in harmony with the environment. And so that's the key. Yeah. So, you mentioned the VikingReds. We've done well with the VikingReds along with Samen NZ. They've seen the opportunity to include that into the mix of these crossbreds between the Jersey and the Holstein, including the VikingReds in there. Can you tell us a bit about what made that happen and why they went that route? Well, I think whilst those crossbreed cows had their benefits to those farmers, there was room for improvement and so that's where Samen NZ you know, targeted the message around the key traits of the Reds that they are cattle with longevity, they're cattle with fertility and so forth. They are also hardy and structurally strong - feet and legs, etc.. So, they're mobile cattle. And I think then you play into a market where if you've got a Holstein Jersey cross cow, you know, there are some crossbred bulls that you can use to maintain a balance of the two breeds. It's either that or you're crossing back to Jersey or back to Holstein. It's switching back and forth. And by incorporating the third breed, it starts to smooth those cattle, I guess, into a more homogeneous group rather than having the predominantly Holsteins in the predominantly Jerseys, depending on how many generations of those each breed. There's quite a bit of difference. When you've got three breeds, it's a far more homogenous group of cattle. Yeah, and so it's about utilizing the hybrid vigor, partly because let's say that you have this crossbred cow Jersey Holstein and you use a crossbred bull, Jersey Holstein, basically you don't know what you're going to get because if the genes mix up, you can get anything from 0 to 100% heterosis. And I think also there's not a huge array of options in those bulls. So it really narrows the field and that's where it's probably more attractive. If you're staying with Holstein and Jersey, you've got a far more choice in the traits and the impact of those traits that you can get from the Holstein breed than you can from the selection of crossbred bulls that are available. So I think another pure breed and particularly one that's numerically significant with a strong breeding program, data behind it such as the VikingReds, becomes a better option with more traits to select for more progress to be made than what was otherwise a limited field. Yeah, and from what I've heard as well is what they appreciate is the size of the VikingReds, which is, you know, exactly intermediate between the Jersey and the Holstein. So and adding a bit more body condition that boosts the fertility. So, many aspects fit into that. I think the strength of the cattle, the robustness of the cow in an environment such as New Zealand where they need to walk, they need to graze, they're hardy, they're easy cow. All of that is attractive in that environment. Yeah. So what are the main traits that they've been looking for in New Zealand within these Red bulls? Well, it's not just the Red bulls, but across the industry at the moment. The predominant milk company is Fonterra. They pick up around 80% of the milk in New Zealand and they're a large organization and they export a lot of milk out of Australia and New Zealand and they feed, if you like, from our corner of the world, they feed a lot of dairy protein into a predominately Asian market and it is perceived that A2 milk is far easier to digest, particularly in a population where the consumption of dairy protein has been historically very, very low or non-existent, depending on where you are. So Fonterra are now requiring farmers to work towards being pure A2 because it gives them greater flexibility when they are selling the milk. So this is a trait that is something that it's no longer preferred, it's mandatory and we are not sending bulls to New Zealand that are not A2A2. And it's something that we see in Denmark as well, Arla is pushing the A2A2 milk as well. And I think globally it is a movement. For the milk processor it gives them flexibility. If you don't want A2A2, well, we just don't need to write it on the package. It's still milk, it tastes the same. But if A2A2 is important to you, yes, we've got that. So that becomes a commercial imperative. It goes beyond breeding preferences, it's just a commercial imperative. And the other one that comes right on the back of that is an animal welfare position that food companies want to take. And part of that animal welfare position that they're taking to the end consumer of our products is that we're not dehorning. So, we're not taking any bulls to New Zealand, except - I have to make an exception - there are some older proven bulls that we're still using, but certainly all the young bulls are polled, preferably PP. All right. Any other things that they're looking at that are specifically important? Look, I think for the New Zealand market, it is about milk solids, far more than volume. Also in those crossbred herds, they're looking very, very closely at other traits as a key priority. Well, we know that the VikingReds have done well, but recently over the last year or so, another one of our products has done well. The Danish Blue. All about gestation length. Tell us a bit more about that. Well, again, as we mentioned earlier, it's a very, very tight seasonal calving pattern and every extra day in milk is dollars. So whilst everyone around the world is using more beef on dairy, the Kiwis are in that same vein, they're using more beef on dairy, but in a tight seasonal calving, if you're all year calving, it's not so important. But in a tight seasonal calving, getting everybody calved within the window is a management issue. But also longer gestation is loss of milk production. And so Samen - this is one of those ideas that I stole from Samen - I'm quite happy to copy. If someone has a really good idea and a really good initiative, I'm not ashamed to replicate it elsewhere. So they went to farmers and said, if you're using a Hereford bull, you're losing up to based on breed averages up to two weeks of milk. How much is that worth? And when the farmer looks at the price of the semen and how much milk they could have been losing, makes the Danish Blue a compelling offer. Then they grow vigorously, they calve well. And now market acceptance of those calves in the calf market or even as a what we would call a vealer market that's improving. And the demand for those calves has been really strong. Samen NZ have been using Belgian Blues in general for some years. And over the last - this is our third year I think - they've been using the Danish Blues where we have a difference and the differences around calving ease and... which is so critical. And historically speaking there are a lot of dairy farmers around the world that probably had nightmares around calving and Belgian Blues in the past. But it's a different game today, particularly with our Danish Blues. The calves have been really, really well accepted by the farmers in New Zealand. We've now replicated this in Australia. They've also been really, really well accepted by the farmers. They come early. It makes sense to go with the short gestation. The short gestation is not just about more days in milk. It also gives that cow longer to recover before she has to re-breed, because in that type seasonal calving we don't like calves that take holidays between calving and re-breeding. Interesting. Jim, looking ahead, what do you expect of the New Zealand market? The New Zealand market is, I guess one that I find surprises me. Just when I think I've got my head around what they do and why they do it, then I learn more so that they do things different or they change things. I finally figure out what it's all for. We're pretty excited at the moment that we've identified some key traits and ways to predict accurately of the traits here from the Nordic evaluation or the Australian evaluation. Just how those bulls are going to rank in the New Zealand evaluation. And we've identified some Holstein bulls that have the particular style and type that will really suit them, that we haven't, we've sold Holstein semen there and been quite happy, but we think we've actually found a compact bodied animal that is going to be that lower impact, high conversion, sort of a cow that they're really looking for. It's great to see that we've been able to find exactly that style of animal within the Nordic population. So that's exciting. Well, Jim, thanks a lot. An improvised podcast about the New Zealand market. Thanks a lot. Thanks for joining us. And any final comments? It's been my pleasure. It's great to share with you listeners wherever they may be, just what we're doing in our part of the world. And it's exciting to share what VikingGenetics is achieving for the dairy farmers around the world. So thank you. Thanks a lot.