Vaccination Programs: Do Branded Programs Increase Price?
Vaccinations are an extremely important component of any herd health program. The optimal program, including type of vaccines and frequency of administration, will depend on operational-specific factors including cattle genetics, calving season, and location. Marketing cattle using Western Video Market (WVM) Auction allows ranchers the flexibility to list all of the vaccinations given to each lot including type (e.g., 8-way, Bovi-Shield Gold, etc.), brand (e.g., Zoetis, Merck), and frequency and timing (e.g., at branding, 2 weeks prior to shipment, etc.). At the same time, WVM has a special place in the sale catalog for ranchers to list the specific "shot programs" in which they participate. These shot programs are groups of vaccinations administered at dictated intervals, in some cases manufactured by specific companies.
Current data include shot programs from the Zoetis' Select VAC line as well as protocols endorsed by WVM. Both of these programs (Zoetis and WVM) have different protocols based on age of cattle and rancher preference. At the end of this post, I provide details on the available Zoetis Select VAC and WVM programs and required shots and timing for calves (Figures A and B). It should be noted that the two programs have very similar shot protocols and timing of administration, with the exception being the Zoetis protocols requiring the use of vaccines manufactured by Zoetis.
While research from veterinary science documents the health and, in some cases, production benefits associated with various vaccines, this post is focused exclusively on whether or not these branded shot programs increase the price that ranchers get for their cattle when sold via Western Video Market Auction. Other posts in this blog series discuss premiums and discounts for various other cattle attributes and marketing programs and the first post in the series discusses the models used to analyze the data.
The results of the analysis for 2017 and 2018 are shown in Figure 1 below. Estimates for 2017 are shown in navy blue and estimates for 2018 are shown in red. All estimates are provided in per hundredweight (cwt.) terms. In the figure below, the dots represent the estimated premium/discount for that particular shot program and the lines that extend away from the dots show the 95% confidence interval. This is the range in which we are 95% certain that the true value of the premium/discount falls.
If the confidence interval includes zero (vertical red line), we cannot be certain (in statistical terms) that the premium/discount is not zero. This is the case for all of the branded shot programs for calves and yearlings in both 2017 and 2018. This means that producers following the specified protocols and marketing their cattle with the shot program designation in the sales catalog did not receive a premium for their cattle associated specifically with that choice. The results discussed herein focus on calves exclusively. The yearling results, although not shown here, are extremely similar.
Figure 1. Estimated Premiums for Branded Shot Programs for Calves (2017 and 2018)
It should noted that both the Zoetis Select WeanVAC and the WVM Wean VAC programs require 45 days or more of weaning. As shown in previous blog posts, weaning of cattle does result in statistically signifciant premiums on sale day. For example, in 2018 weaning produced an estimated premium of $3.81/cwt.
It is my belief that one of the primary factors driving these shot programs to not generate signifciant premiums is the flexibility afforded to ranchers via WVM. Since producers can detail their vaccines and weaning protocols in the sales catalog, the option to list specific branded shot programs does not provide buyers with any new or additional information. Further, if ranchers provide the same vaccines (and in some cases more) than the shot programs require, there is not reason for buyers to pay more for lots simply because they list the name of a specific shot program.
Year-to-year variability in premiums/discounts can be caused by many factors. These estimates represent averages across all calves marketed in 2017 and 2018 through WVM. These are not meant to be taken as forecasts for premiums/discounts in the future.
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Figure A. Zoetis Select VAC Shot Programs
Figure B. WVM Shot Programs