TECHNICAL BULLETIN GENEMAX FOCUS - EVALUATION OF GROWTH & GRADE FOR COMMERCIAL USERS OF ANGUS GENETICS. November 2016

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1 TECHNICAL BULLETIN November 2016 GENEMAX FOCUS - EVALUATION OF GROWTH & GRADE FOR COMMERCIAL USERS OF ANGUS GENETICS Zoetis Genetics 333 Portage Street Kalamazoo, MI KEY POINTS GeneMax Focus is a genomic test for commercial Angus replacement females that are 75% and greater Black Angus and is designed to enhance the production efficiency of Certified Angus Beef GeneMax Focus delivers genetic predictions for four traits including weaning weight (WW), post-weaning feedlot gain (Gain), carcass weight (CW) and USDA marbling score (Marb); an economic selection index called GMX Score that ranks animals for net returns from combined genetic merit for evaluated traits; and Sire Match to HD 50K and i50k tested Angus A.I. and natural service bull batteries GeneMax Focus helps inform replacement heifer selection and breeding decisions and results may be integrated into feeder cattle marketing programs for enhanced price discovery of untested steer mates to help mitigate risks associated with feedlot performance and quality grade premiums / discounts GeneMax Focus was built from the knowledge of marker effects generated by the Zoetis HD 50K version 4 calibration in Angus seedstock that included over three times as many animals as what was used to develop the original version GeneMax Focus validation exercises generally indicate that 40 to 50% of the genetic variation (differences) in the primary target traits gain and marbling, and 25 to 30% of the variation in weaning weight and carcass weight are accounted for by GeneMax Focus predictions. INTRODUCTION GeneMax Focus was originally developed in 2012 through a collaborative partnership that included Certified Angus Beef (CAB), Angus Genetics Inc. (AGI) and Zoetis (formerly Pfizer Animal Health). As the name implies, Focus was initially designed as a replacement heifer selection tool to concentrate on cost-effective evaluation of two key traits that impact feeder cattle value and efficient production of Certified Angus Beef feedlot gain and marbling. For simplified multiple trait selection, the original version of GeneMax Focus also included an economic selection index called GMX Score that ranked animals for combined genetic merit for gain and grade. The initial targeted panel of markers used for GeneMax Focus was developed from the HD 50K for Angus calibration version 2 that included approximately 12,000 genotyped Angus seedstock animals with gain and marbling Expected Progeny Differences (EPDs). Internal and external

2 evaluations of efficacy demonstrated the effectiveness of this targeted marker panel for predicting genetic merit for these key traits involved in the production of CAB 1,2. With the premise of continued focus on describing as much genetic variation in post-weaning growth and marbling as possible at the same price point, notable advancements on two fronts created opportunities to refresh and expand GeneMax Focus. First, more additive genetic variation was described by the HD 50K for Angus calibration version 4 marker effects for marbling and post-weaning gain, which included genotypes and EPDs for 37,215 and 49,180 animals, respectively for the target traits. Second, the Eureka Genotyping Solution enabled roughly a 20% increase in the number of marker genotypes available for computation of Molecular Value Predictions (MVP). Together these allowed for a broader, more up-to-date and informative set of markers to drive GeneMax Focus predictions. Since the markers used in this new version are somewhat different from the original, it is not feasible to generate updated results for previously tested animals. PRODUCT DESCRIPTION GeneMax Focus is intended for use in 75% and greater black Angus replacement heifer candidates and includes genomic predictions for weaning weight (WW), post-weaning gain (Gain), carcass weight (CW), marbling score (Marb), an economic index that includes growth traits and marbling (GMX Score) and Sire Match to HD 50K and i50k tested Angus bull batteries. Genomic predictions for the individual traits and index are expressed as normally distributed scores from 1 to 100, where 50 is the average genetic merit as benchmarked against the current reference population of 37,514 commercial Angus replacement females which is periodically updated as tested animals accumulate. It follows that the scores are associated with underlying MVP for individual traits and with predicted dollar value differences for GMX Scores. GeneMax Focus results help inform replacement heifer selection and life-long breeding decisions and may be used along with bull battery GE- EPD information in various feeder cattle marketing programs for enhanced price discovery. The original version of GeneMax Focus expressed results as uniformly distributed percentile rank scores from 1 to 5 for gain and marbling (quintiles of underlying MVP) and 1 to 100 percent ranks for the GMX Score index. While simple, over time with favorable genetic trends the 1 to 5 scores sometimes did not specifically differentiate underlying genetic merit among animals for some customers. As well, sole use of percentile ranks tends to slightly exaggerate differences in MVP among animals with genetic merit around the mean of the population and under-express differences in MVP for especially inferior and superior animals. Transformation of underlying MVP and index values to a normally distributed 1 to 100 scale more specifically and fairly communicates genetic differences. At the same time, these 1 to 100 scores also imply ranking of genetic merit for the purpose of simple benchmarking against the industry-wide, tested population. TRAIT PREDICTION DEVELOPMENT AND INITIAL VALIDATION Classic, non-genomic enhanced EPDs provided by AGI for seedstock Angus animals with HD 50K genotypes, marbling EPDs (n=37,215), and post-weaning gain EPDs (n=49,120) were used as response variables for genomic analysis. These data were divided into two groups based on EPD accuracy: the highest accuracy 80% for training cross-validation (CV) and the 20% lowest accuracy for external validation. Significant markers were then subjected to compound covariate methods to ultimately select an optimal

3 subset of markers to cost-effectively explain genetic variation in marbling and post-weaning gain. The final marker effects and MVP were computed for the target traits marbling and gain, as well as for genetically related traits weaning and carcass weight, using Gensel BayesC 3. The external validation dataset consisted of animals referenced above that were not used in training CV (20% with lowest accuracy), and associated Classic EPDs as well as MVPs generated from selected markers and derived effects. To evaluate the accuracy of MVPs, correlations were computed with Classic EPDs using these animals. The correlation between EPDs and MVPs for post-weaning gain was.61, and for marbling was.65. Beyond these target traits, the same correlations for weaning weight and carcass weight were.52 and.51, respectively. The square of these correlations generally indicates around 40% explained genetic variation for the target traits gain and marbling, and just over 25% for weaning and carcass weight. GMX SCORE INDEX DEVELOPMENT Economic selection indexes help simplify and appropriately balance selection decisions for combinations of traits and related economic returns. GeneMax Focus GMX Scores rank replacement heifer candidates for combined genetic merit for growth, carcass weight and quality grade (marbling) and anticipated economic impact on feedlot closeouts, assuming cattle are marketed on marbling oriented, CAB type grids. The GMX Scores were developed using classic selection index methodology that incorporates genomic predictions and explained genetic variation, relationships among available predictions, as well as assumptions pertaining to revenues and costs from anticipated expressed performance. The economic assumptions for GMX Score development were consistent with those used by AGI for dollar-value indexes, and generally represent the most recent three-year averages. 4 The weights applied to trait predictions were calculated based on these economic inputs, and adjusted for their respective genetic variances and correlations. Relative contributions of different traits to GMX Score are provided in Figure 1, and illustrate that growth traits are the most influential component, followed by marbling and carcass weight where the latter also acts to help constrain discounts from excessively heavy carcasses. GMX SCORES AND COMPONENT TRAITS When using indexes to simplify selection, it is useful to document relationships between index values and predictions for component traits to better understand correlated responses to selection. Using the reference population of 37,514 genotyped commercial Angus females, correlations among GeneMax Focus trait predictions and GMX Scores were calculated and provided in Table 1. Selection based on GMX Score is expected to yield consistently favorable correlated response in weaning weight, gain and marbling (correlations of.75,.77 and.69 respectively) as well as in carcass weight (correlation of.47). Relationships among predictors of genetic merit for growth traits were high (correlations of Trait GMX Score Marbling Score Carcass Weight Post-Weaning Gain Weaning Weight Post-Weaning Gain Carcass Weight Marbling Score 0.69 Table 1. Correlations among trait and index predictions included in GeneMax Focus.

4 Trait / Index Average MVP of Top 25% Average MVP of 2nd 25% Average MVP of 3rd 25% Average MVP of Bottom 25% Weaning Weight (lbs.) Post-weaning Gain (lbs.) Carcass Weight (lbs.) Marbling Score (units) GMX Score Index ($) $75 $56 $43 $26 Table 2. Underlying average MVP/Index values by quartiles of GMX Scores. ADDITIONAL EXTERNAL VALIDATION.67 to.88), while associations between genomic predictions for growth traits and marbling were favorable but fairly low (.14 to.28). The later indicates that relatively independent subsets of markers (genes) account for described genetic variation in growth traits versus quality grade (marbling). Also in regard to understanding anticipated response to selection, it is useful to document the underlying trait MVP and index dollar values that correspond to different ranges in GMX Scores (Table 2). Using the same commercial Angus population as referenced above, the top 25% versus bottom 25% of females as determined by GMX Score are predicted to have $49 higher average index value ($75- $26=$49), from added average genetic merit for weaning weight (17 lbs.), gain (15 lbs.), carcass weight (10 lbs.) and nearly one-half unit in quality grade (.46 marbling score units). One-half of this average advantage in trait MVP (breeding value) and index value would be transmitted to each progeny of selected females in retained ownership production systems. Beyond retained ownership, along with GE-EPDs from Angus bull batteries, GeneMax Focus results are also integrated into special feeder cattle marketing programs, including Angus Source, Top Dollar Angus and Reputation Feeder Cattle 5. Expected Progeny Differences (EPDs) with relatively high accuracy from Artificial Insemination (AI) sires is arguably closest to a gold standard against which to compare the efficacy of genomic predictions from targeted marker assays. While such proven AI sires were included in product development and are not the intended target for GeneMax Focus testing, relationships between Focus Scores and high accuracy EPDs help provide assurance that selected markers, calibrated effects, and transformation to 1 to 100 scores come together to align reasonably well with dependably known genetic merit. GeneMax Focus results from 383 bulls with accuracy values for carcass weight of 0.50 or greater were used to further validate Focus predictions. The EPDs and accuracy values were computed by AGI and released in June Resulting correlations are provided in Table 3 and along with internal validation further characterize the explained proportions of genetic variation and strength of anticipated relationship between GeneMax Focus predicted and proven genetic merit. Although not necessarily validation, using the 37,514 head reference population of commercial Angus females, correlations Trait /Index WW EPD YW EPD CW EPD Marb EPD GMX WW.65 GMX Gain.68 GMX CW.48 GMX Marb.78 Table 3. Correlations between GeneMax Focus predictions and high accuracy EPDs/$B for Angus AI sires.

5 between GeneMax Focus and GeneMax Advantage trait predictions were derived. Generally, these correlations were similar but slightly lower than those listed above,.58 for weaning weight and gain,.47 for carcass weight, and.68 for marbling. These magnitudes of relationship across different segments of the Angus population used for product development, initial and external validation are consistent and in line with expectations given the scope of markers included. AVAILABLE SIRE MATCH ENABLED WITH HD 50K AND I50K GeneMax Focus also matches registered, transferred Angus sires to their tested heifer progeny. This feature allows producers with HD 50K and i50k-tested Angus bulls to proactively manage inbreeding when mating tested heifers, while still providing the flexibility of multisire breeding systems and combined use of artificial insemination and natural service breeding. Inbreeding has generally been documented to adversely affect reproductive, survival and fitness traits. It follows that Sire Match also provides insight as to genetic merit that daughters had the opportunity to inherit based on their sire s GE-EPDs for the complete range of traits, including maternal productivity. Ideally, customers are advised to designate candidate sires with their AAA registration numbers at time of order submission. Otherwise, in cases where candidate sires have not yet been HD 50K or i50k tested or if ownership has not yet been transferred at the time heifers are tested, Sire Match may be requested following initial delivery of GeneMax Focus results. For Angus cattle the exclusionary power of GeneMax Focus markers is generally comparable to that of the USDA SNP Parentage panel which includes fewer markers. GENEMAX FOCUS TESTING STRATEGY GeneMax Focus results are meant to help inform more profitable selection, mating (including bull buying) and marketing decisions. The following provides general guidance as to testing strategy and use of results: Collect samples during pre-weaning, weaning or bangs vaccination processing from the top two-thirds to three-quarters of the heifer crop that were earliest born and meet visual appraisal criteria (i.e. sound feet and legs, acceptable expressed growth and frame size, adequate body capacity, calm temperament, etc.). Depending on the number of replacements needed, select the top heifers based on GMX Score (growth and marbling), desired individual trait scores, as well as Sire Match results and associated GE-EPDs, especially for maternal traits. Throughout their lifetimes, use GMX Score, individual trait scores, and Sire Match results for mating decisions to A.I. and natural service bull batteries that accentuate genetic strengths, correct weaknesses and minimize inbreeding. Use GeneMax Focus information from tested heifers annually to help inform marketing (sell feeders or retain ownership) and price discovery of untested steer and unselected heifer mates through various feeder cattle marketing programs5 that integrate GeneMax Focus results, as well as document health management information. Use accumulated GeneMax Focus results for the active cow and replacement inventory to provide insight into annual Angus bullbuying decisions to further advance maternal, feedlot and carcass performance and generally purchase bulls that are relatively unrelated to targeted groups of females.

6 GENEMAX FOCUS IS FOR COMMERCIAL HERDS GeneMax Focus is for use in highpercentage Angus commercial replacement females. As a general rule this means progeny of HD 50K and i50k-tested, registered and transferred Angus bulls mated to half-blood or greater Angus cows (i.e., heifers that are 75% or greater Angus genetics). It is not intended for use in registered Angus females or bulls. The predictions obtained with GeneMax Focus are not incorporated into the AAA NCE and will not influence the GE-EPDs of registered animals. SUMMARY GeneMax Focus is intended for use in 75% and greater black Angus replacement heifer candidates and includes genomic predictions for weaning weight (WW), post-weaning gain (Gain), carcass weight (CW), marbling score (Marb), an economic index that includes growth traits and marbling (GMX Score) and Sire Match to HD 50K and i50k tested Angus bull batteries. GeneMax Focus results help inform replacement heifer selection and life-long breeding decisions and may be used along with Angus bull battery GE-EPD information in various feeder cattle marketing programs for enhanced price discovery. References 1 Certified Angus Beef and Angus Genetics Inc. Data on file. 2 GeneMax Focus Field Study Summary 3. Fernando, R. L., and G. J. Dorian User manual for a portfolio of genomic selection related analyses, version 2.0. Animal Breeding and Genetics, Iowa State University. 4 American Angus Association website ($ Value Changes Due to Market Trends). aspx. August 24, Zoetis Services LLC. All rights reserved. All trademarks are the property of Zoetis Services LLC or a related company or licensor unless otherwise noted. GMX-00091

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