Economic Modelling to evaluate the benefits of precision livestock

‘Precision Livestock Farming’ (PLF) technology is an emerging research field which develops management tools aimed at continuous automatic monitoring of animal production, including real-time monitoring of growth, health and welfare. The purpose of PLF is to support farmers in making daily management decisions by providing extra ‘senses’, and to make farmers less dependent on human labour. Many PLF concepts have been developed in recent years, but the uptake of most of these technologies on commercial farms has been slow. Reasons for this slow uptake include the fact that these PLF technologies generate substantial amounts of data but this data is not converted into useful information for decision management. Another reason is that the investment in PLF technologies can be significant, whereas the economic benefits of the investment are unknown. Insight into the on-farm economics of PLF is therefore important. The objective of the study was to develop a value creation tool that models the economic impact of PLF technologies on dairy, fattening pig and broiler farms. The tool uses technical parameters, and the economic impact of PLF implementation can be estimated at farm level by estimating the impact of PLF technologies on these technical parameters. Twenty key global suppliers of PLF technologies were approached in order to gain insight into their views on which of these technical parameters are affected by their PLF technology and to what extent. The knowledge acquired will be used to validate the tool and to gain insight into the costs and benefits of PLF technologies. This current paper specifically reports on the value creation tool developed for dairy farms. Automated heat detection (Nedap N.V., Groenlo, the Netherlands) is used to demonstrate how this tool works and to calculate the potential added value of this PLF technology. The value creation tool will assist, ultimately, in the development of PLF technologies that add value to onfarm decision-making processes.