In his introduction address, the Chairman pointed out several factors which have an impact on the breeding strategies applied to cattle and sheep.
These factors are as follows:
- general economic environment, both at present and in the medium term;
- farm structure;
- orientation of production;
- the level of production intensity and the relative costs of different production factors;
- different market demands, present and predicted;
- optimal economical production level.
Initially the discussion concentrated on sheep and goat breeding. It was agreed that both species are not any great economic importance in the region, as reflected in the country statements. Also, the national survey and economic statistics usually do not cover sheep and goat sufficiently. In most countries the sheep number has dropped over the last years due to the very low profitability of this sector. In Russia, which had the biggest sheep population in the region, its number decreased to 24 millions (50%) and some local breeds, like the Romanov, require urgently that conservation programs be worked out.
In several countries, where sheep products are playing an important role in human diet some efforts have been made to encourage sheep production. Ln Romania, the Eastern country with the second major sheep population of 14 million, the main focus of breeding strategy is on the dissemination of genetic improvement through AI; lately also embryo transfer is being developed with French assistance. In Slovenia, a two step crossbreeding program was introduced with Romanov rams at the first stage and subsequently terminal sires like Texel. At the same time milk production was increased through the introduction of imported East Friesian sheep. In some countries sheep and goat production is supported by the State, but usually this support is not sufficient to maintain profitability.
Farm structure, especially small scale farming, creates many constrains in the implementation of the breeding programs. Such structure requires a close co-operation between farmers and in many cases a direct involvement of the local community (for instance in some areas local community traditionally provides breeding males free of charge).
Small farms very often have got specific genetic material, well adapted, hardy but of low or medium productivity. These unique genetic resources might be lost if such farms are in severe economic difficulties. Small scale farming in most cases, it is a difficult social problem which has to be tackled with care.
In the part of discussion on production directions an analysis of grain price impact on the livestock sector was presented. It was clearly shown that the relationship between costs of grain and forage is a key element in the dairy sector. Although most of milk production may be done on forage, there are limits in food intake so it is necessary to use grain in highly performing herds. With increasing milk yield the value of a calf provides only a small part of the total output (for instance in the UK less than 25%), this is the reason of the drift from dual purpose to dairy breeds observed in some countries. In terms of costs, feeding on grain is expensive and moreover the grain price depends on the competition on international market while costs of forage are determined locally.
At present in many CEEC, beef production is in a crisis. There are several reasons for this situation, mainly the lack of economic attractiveness. The prices are low and the CEEC are not competitive on the world market because of their high production costs. Also, in unstable economic situation a long production cycle increases the risk that may result in changing towards dairy with beef as a by-product.
In Poland milk price is the main factor directing dairy breeding towards milk yield increase. As the market develops the consumer demand increasing and the other factors like milk quality and animal/udder health are becoming more important. Now it is getting necessary to deliver the right product to the consumer if one wants to be able to sell it. The milk quality (protein/fat content) is relatively easy to change but the health status of animals is difficult to improve.
Since the last couple of years beef population has been rapidly increasing in Poland. Some scientists and breeders are in favor of separating dairy and beef instead of improving dual-purpose cattle. Considering the present productivity of cows as well as production conditions, the question to know whether such strategy is economically justified in countries like Poland has to be answered. Also in Ukraine it is planned to divide cattle population into dairy and beef, with four million cows used for each purpose. The discussion showed that still there are situations where decisions on such matters are made in order to fulfil different political goals or to please the authorities.
When analyzing factors influencing the determination of production orientation, other elements like capital and labor costs should be taken into consideration. If subsidies are provided by the State it may encourage alternative land use and result in changes in production orientation.
Developing breeding strategy, especially setting up breeding goals, should imply the estimating of trends in own production factors (land, capital, labor and feed costs) as well as those in prices of products, market demands and export possibilities. It will allow the optimization of land use and the determination of the best livestock utilization. Such a task, although it is a difficult one, should be undertaken in every country as the conditions vary to a great extent within the region. The CEEC have not much experience in such approach as in the centrally steered economy breeding goals used to be set up in central governmental organizations. Moreover, the breeding objectives were usually defined without considering their economic importance because many agricultural products were subsidized and there was no direct relationship between costs and prices.
It is also very important to assure that breeding strategy is not too academic or too complicated for people actually involved in running the scheme.
Another aspect which has to be taken into consideration is the actual status of legislation concerning animal breeding in the country in question. Using situation in Hungary as an example it was shown that breeding and market sides of livestock production have to meet to secure profitability in this sector. On the breeding side, developing adequate legislation, reconstructing organizational structure and providing finances to support genetic improvement are factors of major importance. Previously, the breeding companies which used to operate in Hungary were profit oriented. These companies are being changed into breeding societies: at the beginning it was difficult to adapt to such a system.
The terminology had to be sorted out and every element of the system defined in the new situation. The breeding societies to be officially recognized have to propose a breeding program for their stock. They are also in charge of implementing this program. At present the separate company involved in performance recording as well as three 3 AI centres are operating on a contract basis with the breeding societies. All breeding regulations had to be changed to allow structural changes in breeding organization. The new legislation, based on German law, was introduced in 1991, however, there are still areas which require additional regulations. To ensure that legislation is favorable to the agricultural sector farmers should create a lobby influencing political authorities.
A new breeding law is being developed in Ukraine and it should be effective in 1996. It was a difficult task to work out a complex solution for all problems connected with the breeding work in the new situation. The Ukrainian Government recognizes the necessity to support livestock genetic improvement as regards cattle: the purchase of breeding stock and semen for AI is subsidized to the extent of 50%, the importation of genetic material is supported and the national breeding strategy with the co-operation of German and Canadian consulting companies is being worked out.
In Russia, one of the objectives of the new breeding law is to ensure conservation of local rare breeds which are in danger of extinction, like horses from Jakucia. Another problem, specific in countries with such a broad territory, is to provide efficient state recording services and to co-ordinate breeding work going on within the country. The close links between the parties involved in breeding programs have to be established and co-operation system worked out. At the moment a new breeding strategy for cattle with the assistance of the EU programs is being developed in Russia. The implementation of this strategy will create difficulties because of the very hard economic environment, e.g. the equal prices of milk and fuel and a very low productivity level of the dairy population.
During the discussion it was stressed that governments should be vitally interested in progress in animal breeding as this sector supplies food for human population and plays other important social roles. In Germany, the breeding law was introduced some 200 years ago as horses were important at wars and therefore their successful breeding had to be ensured. In modem times the State is obliged to provide efficient breeding legislation especially when the breeding structure is complicated and involves many stages/partners. The mutual relationship between all parties involved has to be regulated by law. As the CEEC are in transition, and entering the new economic system, all the more are new breeding regulations required.
On the other hand even the best breeding law will not ensure genetic progress. In some countries the state has little or no influence at all on the implementation of the breeding programs. The non-governmental organizations like breeding societies are taking over the whole responsibility of the breeding process, from pedigree books through recording to the breeding value estimation. In some countries, like Estonia, the privatization of organizations involved in animal breeding was undertaken - that created a totally different situation both from the legal and economic point of view.
There is one more aspect which should be considered in developing breeding law in the CEEC. The law in these countries should be in the long term compatible with the EU legislation. Each State within EU-15 is obliged to observe specific common rules, like consumer protection, veterinary regulations or technical standards of specification (for instance, comparable methods and accuracy for BVE). So the minimum law is the best one as it creates less problems in the international co-operation. Also it should be stressed that legislation is very much species oriented. The applicable solutions in cattle or sheep are different from those applicable in the case of in poultry or pigs, where breeding is highly commercialized.
- Coming back to the problem of developing breeding strategies, the question of economic wages and of breeding objectives was discussed. It was agreed that economic assessment of breeding goals should be made in each country separately. Even with the similar breeding objectives and similar performance level in cattle populations, the economic environment influencing dairy production may differ very much between countries. Economic assessments are specially difficult, so it has been recommended to organize a seminar on methodology which would be suitable for such purpose. Those experienced in developing new strategies in new conditions should be asked to share their ideas and knowledge of the methods they are using.
During the discussion it was agreed that the workshop on methodology should deal with the assessment of all factors to be taken into consideration in developing breeding strategies, like the best land use, the most effective level of intensity for the direction of a given production as well as the economic conditions and performance coefficients. The profit function derived from such analysis should identify the optimal breeding goals.
Another topic was raised in the discussion concerning the strategy in the utilization of subsidies, i.e.: what is the most effective way to manage subsidies in order to implement genetic progress and increase production in the sector in question? In case of dairy, Croatian experience suggests that it is more effective and simple to have a higher subsidy for milk production than to have the same amount of money divided into different categories: production, breeding stock and services.
At the very end of the session the pyramid explaining what are the factors influencing breeding improvement and production profitability was presented by the representative of Slovenia.
The consecutive levels of the pyramid were as follows:
Farm income.
BLUP
Breeding work
Breeding objectives
Breeding organizations
Breeding law
Farm, market structure
Prices, policy intervention
Economic development in general
This pyramid takes into consideration the World market and EU market characteristics.
The Working Group 2 was attended by the representatives of five CEE countries, i.e.: Belorussia, Estonia, Hungary, Romania and Slovenia. The meeting was also attended by Messrs Bichard (UK) and Scholz (Germany).
As regards market conditions; all participating countries are working on the introduction of quality grading schemes; in some of these countries the EUROP-System is being introduced.
But in none of them pigs are paid yet according to quality grades. Nevertheless the group agreed that a grading scheme with objective criteria is a compulsory prerequisite for a quality oriented breeding program.
As regards farm structures; in all participating countries two farms size categories are frequently found, i.e.:
- the household pig production, usually with less than 10 pigs produced yearly, and namely for home consumption. The proportion of such producers varies between 20 percent in Slovenia to around 50 percent in Hungary and Romania;
- the large production units, in former State or cooperative farms. An important proportion of the remain large units after the political changes and even after privatization has taken place. In particular for this category of predominantly commercial farms, suitable breeding strategies must be developed.
The typical Western European middle class small farm producer with 20 to 100 breeding sows are not well represented in these countries and a specific breeding program for such farmers was only requested in Slovenia.
As regards the structure of breeding organizations; in all countries some traditional pedigree/pure breeding organizations are operating. In some countries like Hungary and Estonia they were founded recently and are being subsidized by the Government, following mostly the traditional West European examples.
Artificial insemination is used in all countries, although to a variable extend more extensively in large nucleus breeding herds and to a lesser extend in number of household pig production farms.
Official hybridization programs are only at the Western breeding companies such as Seghers, BHZP and Dalland, which have established sub-nuclei in Hungary. The main problem seems to be the integration between large units which, so far preferred to remain closed to breeding stock (except for some boars) and consequently often operate rotational crossing schemes. Even in countries with established home breeding companies, such as Hungary, there is great hesitation to transfer a large number of crossbred females between units, however, this seems to be essential for top terminal crossbred hybrid programs. Integrated breeding schemes with specialized large units must include regular exchanges of selected breeding stock, form the top to the bottom of the pyramid.
Subsequently the Working Group discussed the conclusions concerning the breeding strategies to be recommended to CEE countries for their future development of pig breeding.
This discussion led to the following conclusions:
- no breeding program for the group of household pig producers can be recommended. It is felt that the proportion of such producers will diminish in connection with the systematic development of quality breeding programs, the products of which will increasingly take over the market. However, there may be a chance to use such small farmers to maintain endangered local breeds, adapted to prevailing conditions, and which have sometimes performance characteristics very different from those of the products one finds at present on the market. Nevertheless, some public subsidies must be offered to such small holders and hobby breeder if they are required to cooperate in genetic conservation programs;
- with the exception of Slovenia, in the CEE countries there is little demand for cooperative crossbreeding programs among small holders of the typical West European type (20 to 100 sows). It may well be that in other countries where privatization has led to having a larger number of such middle-sized farms, e.g.: in the Czech Republic, Yugoslavia, Croatia, the matter may be different;
- the greatest demand in CEE countries seems to be for the establishment of the typical pyramid shaped systematic crossbreeding programs between large and specialized production units. The distinction of functions between nucleus - multiplier - and weaner production units and the organizational and financial integration between them are the major requirements for the urgent restructuring activities in such countries. It may will be that in very large enterprises with several sub-units, such a system may be implemented within such a single company.
The working group discussed the best way of implementing this in the participating countries. It was agreed that the uncontrolled importation of Western breeding animals from the open market by individual breeders would not be a very efficient way, because most benefits from expensive imported stock can be obtained if it is introduced into a nucleus (at the top of the pyramid) of an already integrated home breeding program which guarantees the maximum multiplication rate of the imported stock. Several participants had serious doubts that under present CEEC conditions, the import of a complete Western nucleus stock and its pure multiplication would be an economically and biologically viable solution. In the light of known genotype/environment interactions with very high performing stock under not fully optimized feeding and management conditions, it was agreed that continuous cooperation between interested CEE countries and external pyramidal programs over a longer period to develop such schemes in large units if CEEC, would be the best breeding strategy.
Two ways on how this could be best implemented were proposed, i.e.:
- Western breeding companies with international experience, in cooperation with large units in CEE countries, would be able to find quickly the most suitable breeding program for local conditions, as they maintain, worldwide, a large number of specific lines among which they can select the best combinations for any specific conditions;
- the second option referred to the experience in East Germany where the best results in large units were achieved with the so called "Einstiegs programs"; namely, by upgrading gradually the well adapted, but too fat Western dam lines, by Western stock of the same breed from a relevant program. The highest performing weaner producing units in East Germany have reached 60 to 80 per cent of Western genes in their dam lines and the terminal cross progeny of such sows of the meat type boars are, with the EUROP classification, the most competitive products for fattening farms.
The conclusion of this discussion was that there is no single patterned solution as regards the best breeding strategy in all CEE countries. However, national subsidies and international support should particularly favor cooperative projects in the pyramid structure and project proposals aimed at setting up responsible bilateral cooperation between Eastern and Western organizations for a longer transition period, and thereby try to make the best use of genetic material and management resources on both sides.
