Sire selection and genetic improvement of dairy cattle assuming pure market competition

Breeding companies and farmers rely on selection indices to identify sires they expect to improve production system profitability. Such indices combine estimates of genetic merit for individual traits with corresponding economic values that are fixed based on circumstances at a particular time. Perfect market competition has also been proposed as an economic basis to value alternative sires. The objective of this study was to propose an economic model and develop it for the evaluation of dairy sires. The pure competition model (PUC) was used to evaluate the relationship between a profitability index based on the PUC approach versus the traditional selection index approach for 330 dairy sires comprising Holstein-Friesians, Jerseys, and Ayrshires. The correlation between these 2 selection indices was only 0.56, indicating that the conventional selection index did not correlate well with an index based on the PUC model. In particular, the higher ranking bulls were overvalued using the conventional selection index. Our study concluded that the use of fixed economic values is problematic for the delivery of consistent rankings in selection indices. In contrast, sire rankings based on PUC are more reliable because the sires are evaluated on the basis of efficiency gains rather than production while accounting for market prices and marginal values of dairy outputs over time.