Industry Questions for Herd Production Medicine
Version 2.1 Updated September 18, 2000
Purpose of these Questions:
The purpose is to provide an industry-focused framework for developing
an understanding a segment the agricultural animal industry (e.g., commercial beef
cow-calf, beef stocker, beef feedlot, dairy, custom calf raiser, sheep, swine farrowing,
swine finishing, seedstock producer or other) that is sufficient to enable the
- Assemble and, over time, modify
an effective, innovative package of veterinary services to deliver to clients engaged in a
particular segment of the livestock industry that takes advantge of opportunities
and of trends in that segment.
- Understand clients'
perspectives, their "bottom line", and the information that they require for
decision making when the practitioner is marketing, establishing, justifying, and
monitoring services provided to the client in a particular segment of the industry.
- Understand the current and
likely future trends in an industry segment, the likely impact of these trends on clients
in that segment, and the consequences for veterinary practice in that segment. Powerful
economic and social forces are causing rapid change in some segments of the livestock
Understand the basic economic structure of a client's
business, indentify the key economic and production benchmarks for that industry segment
and know the means for assessing them.
Note: The following ordering is a somewhat logical order rather than a
rank of importance. Some of these questions are intended to jumpstart your thinking or to
start you thinking from other than the conventional veterinary perspective rather than
having a concrete answer. If you note errors, oversights or ommissions, please let me know.
Industry Demographics: (What is
the basic structure of the industry?)
- Based on their resource inputs (e.g. capital, feeds, labor, water, land, genetics) and
product outputs (e.g. calves, milk, seedstock, cull animals, finished animals), what are
the natural segments of the industry? What major factors determine this segmentation?
Ex: Registered seedstock vs. commercial livestock, low input grazing
vs. high input intensive dairies, home-raised vs. custom dairy calf raisers, backgrounders
vs. feedlots, stocker or yearling grazers vs. conventional cow-calf operations, primary
livestock enterprise (primary family income is from livestock operation) vs. secondary
livestock enterprise (primary family incomes is from elsewhere), equity operators vs.
- What is the scale (range of size) of enterprises (in terms of number of production
units, typically number of head, facility and stock investment, gross income) in an
industry segment and geopgraphic region of interest to you? To achieve your desired income
from production medicine, how many of these operations do you need as clients and what
will you cost them per production unit?
See USDA Census of Agriculture. Select
Data Query by Geographic Region, State, County, Table 14.
- What general factors affect this distribution (e.g. transportation costs, weather,
water, feeds, ancillary services, land availability, marketing opportunities,
environmental and business structure restrictions, supporting commercial and social
infrastructure (specialized equipment and feed suppliers, hoof trimmers))?
- What are the trends in these distributions? What types of enterprises are disappearing
and what types are growing? What general factors are driving the changes? What is the
effect of these trends on veterinarians and the packages of services they deliver?
For a good discussion see a write-up on a 1997 talk by Purdue ag.
economist M Boehlje that appeared in the Agway Cooperator.
For a discussion of the meat industries, see:
"The Changing Meat Industry: Implications for the Beef Sector and
Cooperative Extension's Role" (Bailey, Bastian, Glover, Menkhaus, 1993) (note - the
HTML is in three parts)
"Today's Changing Meat Industry and Tomorrow's Beef Sector"
(Bastian, Bailey, Menkaus, Gover, 1994)
For the banker's perspective, see Federal Reserve Bank of Kansas City Economic
From the Plains to the Plate: Can the beef industry regain market
Consolidation in U.S. Agriculture: The New Rural Landscape and Public
U.S. Agriculture at the Crossroads in 1999
- In which geographic regions are new enterprises being established, what is their scale,
and what factors are determining their location? What are the consequences of these
developments on the rest of the industry? On emerging opportunities for veterinarians?
- How does the total production of an industry segment vary year to year and how does this
variation affect prices? What causes annual and longer cycles? What is happening at the
enterprise level to cause this cycling? What are the characteristics and the critical
economic and production indicators of the enterprises that do not survive the bottoms of
these cycles? What are the effects of these cycles on veterinarians and what are the
Ex: The annual cycle in beef calf prices and cull cow prices, the
"7 year" beef cow cycle
(Do I really have an accurate picture of the players in the
industry that my clients are in?)
What are the relative values of these resources between regions? What is the competition
for these resources in different regions?
What affects non-fixed, operating resources (especially feed and water) availability and
- What major resources and services (e.g.: skilled and unskilled labor, water, forage,
capital, land, management skills, replacements, housing, specialized equipment, marketing
opportunities) are required by enterprises in a segment in different regions?
- What is the optimal physical quantity and economic value of these major capital (fixed)
resources on a per production unit (or other capacity measure) basis (e.g. yield per head,
labor hrs per head, facility investment per head, winter feed cost per head, yield per
acre)? What are the generally regarded target values ("rules of thumb") for a
given type of enterprise? What values indicate a low likelihood of survival for a
particular enterprise? A high likelihood?
Ex: What is the typical investment in free stall housing or in a
milking parlor on a per lactating cow basis? In a feedlot feed mill on a per head basis?
In ranch grazing land on a per cow basis? What is a dangerously abnormal amount?
For typical values, check the following:
Morris, DL, ed. (1995). Standardized Performance Analysis of Beef
Cattle Operations. Vet Clin North Am Food Anim Pract 11(2) July 1995.
What are the different market routes for a segment's products? What causes price
differences and marketing cost differences between regions?
Ex: Alfalfa hay costs in different areas drought, rain timing,
irrigation water availability, opportunity competition from other crops.
What is the tendency toward vertical integration (controlling more stages of
production)? What factors are driving this trend? What are the likely consequences for the
rest of the industry? For the veterinarians serving this segment? What new opportunities
will this vertical integration provide for veterinarians (e.g., linkage between cow-calf
producers and feedlots, including certification of freedom from selected diseases and of
What is the tendency toward product differentiation away from a commodity market (e.g.,
dairy producer-handler production of special cheeses into niche markets, branded beef
lines)? What are the roles for veterinarians in these (e.g., certifying food safety,
assisting in genetic selection)
Ex: Haulage costs for milk from milksheds to population centers, milk
Dairy Industry: Information on Prices for Fluid Milk and the Factors
That Influence Them (GAO report)
What is the tendency toward horizontal integration (increasing scale or size)? What
factors are driving this trend? What are the likely consequences for the rest of the
industry and for veterinarians?
What is happening to the numbers of enterprises relative to the numbers of animals in
different regions? Why? What are the likely consequences for veterinarians?
For an example of a failure in the beef industry, see "Niche Marketing
Considerations: Beef as a Case Example" (Bastian and Menkhaus, 1997)
For an example of a success in the beef industry, see Harris Ranch Beef
For comparison of costs and prices between years: AIER Cost-of-Living Calculator
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(political, environmental, social, tax, legislative, land use, animal welfare - What
outside forces will impact my clients' livelihood?)
- What are the major producer organizations representing industry segments and what are
their primary concerns?
Selected Examples: American Farm Bureau,
National Cattlemen's Beef Association (NCBA),
American Dairy Association, National Milk Producer's Federation (NMPF)
- What are serious controversies potentially affecting segment enterprises in a region?
Who are the opponents to segment enterprises in a region and what are their motives? What
will be the effect of adverse outcomes on the economics of operations? What are the likely
consequences to these enterprises if a disadvantageous legal outcome occurs? How are
veterinarians involved and how will they be impacted?
Ex: Manure and waste management, water conservation and allocation,
odor control, food safety, animal rights and welfare, urban encroachment, waterway
pollution, manure disposal, nuisances (flies, dust) affecting other high value crops.
- How does the local, state and federal tax code influence industry structure and how does
it influence decisions by investors to make short and long term investments in particular
segments? What other factors influence investment by outside investors?
- What is the effect of government programs (commodity support programs, water projects,
environmental pollution control, trade) on the economics of industry segments and what is
the likely trend of these programs? What will be the effect of these trends on the
economic and production goals of operators?
Ex: USDA CRP program, emergency grazing, and the beef cattle supply
- What is the effect of current international tariffs and quotas? What is the likely
effect of anticipated changes in these? What will be the effect of these trends on the
economic and production goals of operators?
Ex: Importing countries requiring imported products of livestock origin
to originate from herds free of specific viral, bacterial and parasitic diseases.
Typical Production Cycle:
(What is the life cycle of the livestock in my clients' operations?)
- What is the production cycle of individual animals and of enterprises in an industry
Dairy Ex: Cow freshens, is bred optimally at 80 DIM, dries at 305 DIM,
has a 45 day dry period and calves again. Calf is liquid fed for 40 days, weaned at 50,
progressively grouped and bred at 15 months. If dairy is grazing based, herd calving is
synchronized to the grass growth.
Beef Ex: Spring-calving herds vs. fall-calving herds
- How does the production cycle of a segment relate to other vertical components of the
industry and to prices?
Ex: Spring calves from cow-calf operations going to winter stocker
grazing operations to feedlots for finishing.
Ex: Annual price cycle for weaned calves and for cull cows (With
veterinary input, how can a producer exploit these?).
- What are the measures of quality of the output of a phase of a production cycle? What is
the economic value of a unit of that qualtiy?
Dairy Ex: Premiums paid for low cell count milk, for high protein milk, for low
bacterial count milk.
Beef Ex: Docks for brands on sides, horns, intact bull calves, "out of favor"
breeds or cross breeds, non-uniform lots.
- How does the annual climate cycle affect the production cycle of a segment (e.g., the
forage cycle), the production system selected by each segment (e.g., warm housing vs.
hutches, drylot vs. free stall), and what is the effect of adverse year-to-year variation
(e.g., drought years, excessive rainfall years)? What opportunities do these variations
and the producers need to manage them present to veterinarians?
Beef Ex: Herd culling and minimum cost supplemental feeding of beef
cows during drought.
Ex: Substitute unusually cheap purchased feeds for previously raised
but more expensive home-raised feeds if the raised feeds can be stored without significant
- What are the critical points or phases of the production cycle and what are the major
problems of animals that are associated with these points?
Ex: Calves: Transition from monogastric to ruminant (dairy), transition
from liquid to dry feeds (beef and dairy), weaning (beef and dairy), grouping (dairy).
Ex: Cows: Late pregnancy feeding (beef and dairy), transition to peak
lactation (dairy), re-breeding (beef).
- What are the animal husbandry objectives (e.g., nutrition management, animal density,
animal comfort, group selection, production) during each critical point or phase of the
production cycle? What are the values of typical goals (e.g.: age at first calving, peak
lbs., days open, lbs. feed per lb. gain, ...)?
Ex: Rapidly getting dairy cows to maximum peak milk (How does this
relate to total lactation production?).
- What is the optimum timing or length of components of this production cycle for an
individual animal? What is the economic cost per day of a component being longer or
shorter (the cost of being longer are often different than the cost of being shorter and
are often different between types of animals, such as heifers verses cows)?
Ex: 24 months of age at first calving vs. younger or older (dairy), 45
day dry period vs. longer or shorter (dairy), 80 days in milk at conception vs. longer or
- What are the inputs and outputs during each phase of the production cycle? What are the
typical market values of these inputs and outputs?
Ex: value of ration components for lactation, price of semen for
breeding, value of a newborn calf, cost of teatdip.
- What are the typical production system problems of each phase of this production cycle?
How are these problems detected and who detects them? Is detecting these problems earlier
beneficial and, if so, how might this detection be done? What are the consequences of late
problem detection? What are the current and potential roles of the veterinarian, both in
detecting, solving, and preventing these problems?
Ex: Pneumonia in recently weaned calves, coccidiosis in grouped calves in winter,
hypocalcemia, ketosis, coliform mastitis, laminitis or displaced abomasums in
- How can these problems be prevented and what can be monitored other than the occurrence
of the problem to determine if prevention practices are effective and sufficient? What
individual animal records and record summaries are needed? What are current and potential
roles of the veterinarian?
- What are the veterinary-related events the occur in this production cycle? What are the
cost versus benefits of each of these? On what basis can the veterinarian justify the use
or non-use of each of these?
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Ex: Vaccination timing for calves and cows, bull breeding soundness exams, pre-breeding
exams, cow pregnancy checking.
Goals, Economics, and Survival:
(What is the bottom line of my client's business?)
- What are common economic and non-economic goals of enterprise operators in an industry
segment? How do these goals differ and even conflict between segments?
- What is the likely minimum economic size of segment enterprises by region? What are the
major factors determining this threshold?
Ex: See Bailey K, Hardin D, Spain J et al. An economic simulation study of large scale
dairy units in the Midwest. J Dairy Sci 80:205-215 (1997)
- What are the key economic and production measures that determine short and long term
survival of an enterprise in each segment in different regions? How are these factors
measured and how are they related?
Ex: 1997 Milk Production Costs from 871 Wisconsin Dairy Farms, Univ. Wisc. Center for
Ex: Cost of Production (COP) Analysis and Benchmarking Your Beef Operation (New
Ex: Managing for Today's Cattle Market and Beyond (Arizona State Univ)
- If the primary product is a commodity, what are the key indicators that a producer is a
low cost producer compared to other producers in the segment?
- What are the subsidiary production measures that are commonly used, how are they
measured, and how are they related to the key economic measures?
- What are the important economic measures and objectives during each phase of the
- What is the economic value of a unit change of each of these measures? How does this
value change over the ranges of the base unit (i.e., how linear is the relationship? E.g.
cost of days open)? Which have the potential of the highest return per unit of investment
(time, dollars) by management? Which the lowest?
- What are the facility investment vs. sub-optimal production risk tradeoffs (e.g. free
stall vs. drylot and coliform mastitis, swine production and housing management strategies
- EMW, off-site, all in / all out)? What are the break-even points?
- What are the risks (market prices, epizootics, climatic, reproductive failure, ...) to
enterprise survival in the different segments? How are these risks managed? What is the
veterinarian's role in this risk management?
- What is the economic cost of "failures" (e.g., clinical mastitis, failure to
breed, calf death, BRD case, ...) that veterinarians have traditionally been involved
with? How many normal units of production or net profit does it take to balance the
economic loss of a typical case (particularly in terms of net profit)?
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Replacement and Genetic Improvement: (How do my clients improve
the inherent productivity of their livestock?)
- What are the genetic characteristics of economic importance in each segment and what is
their heritability? Do these characteristics differ and even conflict between segments?
Ex: Larger sized weaned calf vs. optimal carcass size for packer
- What is the economic value of a one unit change of each of these genetic
- What are the different methods of managing replacement raising, breeding and selection?
How rapid is the expected rate of improvement when they are used?
- What are the important parameters in raising replacements (e.g., rate of gain, cost of
gain, age at purberty, age at first calving, weight at first calving, life time
production) and how are they related and managed?
Dairy Ex: Relationship between rapid rate of peri-pubertal weight gain and loss of
future lifetime productivity (for a review, see J Anim Sci 1997 75:846-51(?))
Beef Ex: Selection and raising of replacements (for a review, see J Anim Sci 1992
70:4018-35 (?), J Anim Sci 1993 71:3155-63 (?))
- What are the benefits, the risks, and the economic consequences of different genetic
management strategies? How do these different replacement breeding strategies impact other
aspects of the enterprise such as labor and capital requirements?
- What are the names of the more famous seedstock (bulls and cows) in selected breeds and
their records (a must for working with registered seedstock producers!)?
- What are the major groups standardizing genetic evaluations? How do these groups
function and what traits do they measure?
Ex: National Dairy Herd Improvement Association (DHIA, dairy)
Beef Improvement Federation (BIF, beef)
BIF Guidelines for Uniform
Beef Improvement Programs (180 pages)
(Note: Historically, the BIF server has been very slow and your browser may time out
before the getting the page)
- What is the veterinarian's current role in replacement breeding and selection? What are
the opportunities for veterinarians?
- What is the genetic impact of veterinarian-advocated selection practices on other
economically important heritable traits?
Beef Ex: What are the effects on frame and birth weight from selecting
larger pelvic opening size in heifers? The potential relationship between selecting bulls
on the basis of testicular size and precocious purberty in their offspring? What are the
effects on birthweight of selecting on yearling weight alone (see J Anim Sci 1998
Producer Information Sources:
(How do my clients find out about alternative ways of doing
- What are the primary sources of production-related information for producers in the
different industry segments? How do the better managers differ from the poorer managers in
their use of information?
- Who are the information providers that compete with the veterinarian and what is their
usual level of knowledge? How do operators perceive veterinarians relative to these
competitors (credibility, knowledge, bias, cost, ...)?
- What are the major trade magazines (free advertiser supported and subscription)?
- What is the role of the Internet? What is the characteristics of the producers that use
the Internet? How is the Internet changing the role of the veterinarian changing with
respect to providing information and evaluating information?
- How is the role of the veterinarian changing as operations increase in size? What are
the opportunties for farm-derived information on larger operations?
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Interventions and Services: (What can I do for my clients?)
- What are the current veterinary interventions or services typically delivered to an
industry segment in different regions?
- What are the potential veterinary interventions and services that may constitute a
package for each of the industry segments?
- What are the veterinary skills and knowledge currently required to execute these
interventions and to provide advisory services? What is likely to be necessary in the
- How do producers perceive these services and the veterinarian delivering them? Who are
currently and potentially the veterinarian's competition and how do producers perceive
each? What are the competition's expertise and skills? What are the veterinarian's
competitive advantages and disadvantages?
Wise, JK (1995). The U.S. Livestock Market for Veterinary Medical Services and
Products. AVMA Annual Report.
Wise, JK (1988). Livestock producers' attitudes about food animal veterinariran. JAVMA
Wise, JK (1988). Livestock producers' ratings of alternative veterinary information
sources. JAVMA 192:808-810.
National Animal Health
Monitoring System (NAHMS) Reports (click on species - extensive surveys of randomly
selected producers on information sources, use of veterinarians, management practices,
disease problems, production results and economics)
Beef Feedlot (COFE - 1995) - Parts I, II
Beef Cow-Calf (1997) - Parts I, II, III
Dairy Cattle (1996) - Parts I, II, III
- What currently available technology is under- or over-utilized by many veterinarians
delivering services to an industry segment? How can the veterinarian's competition use
- What is the likely impact of developing technology on existing and potential veterinary
interventions or services? How can the veterinarian's competition potentially use this
- What are the benefits and costs to the enterprise of each intervention or service (in
terms of production, dollars, management and labor time, disruption of routines, ...)?
What, if any, are the potential impacts of each intervention on other phases or aspects of
the production system?
- How can these interventions and services be marketed? What information is needed to
support the value of these interventions to the client? What are the most important
incentives and disincentives for a manager to adopt an intervention or service?
- How can the veterinarian monitor the benefit/cost of these interventions and services,
evaluate their effectiveness, and document their results?
- How do veterinary interventions affect enterprise risks and their management?
- What is the approximate minimum clientele "mass" to justify making the
investment necessary (time and money) to develop the knowledge and skills for each
intervention or service? What is the likely long-term trend of this clientele
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Relationships Between Service
Providers: (How do I work with others who also work with my
- What relationships occur between service providers to typical enterprises?
- What is the role of the veterinarian in these relationships?
a Winning Team of Consultants (Moormans)
and Managing Effective Farm Teams (Jeffrey Reneau, University of Minnesota)
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Medicine Information Sources for Food Animal Veterinarians: (Where
can I find out about better ways of doing things?)
- What are the relevant professional organizations for food animal veterinarians in each
- What, where, and when are the major professional meetings that are relevant to food
- What are the relevant scientific and professional journals for production medicine
- What are the major textbooks covering relevant production medicine topics at the level
of information needed by the production medicine veterinarian? While in practice, how can
the practitioner become aware of relevant new texts?
- What are the other major sources of printed information on production medicine topics
and how can items be obtained (particularly those containing relevant economic
- Who and where are the academic clinicians specializing in particular industry segments
that have a nation-wide or international reputations? How can the practitioner contact
- Who and where are the private practitioners serving particular industry segments who
also have a nation-wide reputation for production medicine? How can the practitioner
identify and contact them?
- What are the means by which practicing food animal veterinarians can update existing
expertise, acquire new knowledge and skills, and maximize credibility? What is the
relative effectiveness and cost of each in terms of effort required, knowledge gained,
time in-practice, time away from practice, and expense?
Ex: Post-graduate programs at the Great Plains Veterinary Education Center
(beef), University of Wisconsin
Dairy Herd Management Certificate Program and Pennsylvania State University (dairy).
Ex: Seminars associated with national meetings of professional
associations such as the AABP.
page URL: http://www.vetmed.wsu.edu/courses-jmgay/IndustryQuestions.htm