IDEAS home Printed from https://ideas.repec.org/a/ags/jlaare/122317.html
   My bibliography  Save this article

The Effect of Value-Added Management on Calf Prices at Superior Livestock Auction Video Markets

Author

Listed:
  • Zimmerman, Lance C.
  • Schroeder, Ted C.
  • Dhuyvetter, Kevin C.
  • Olson, K.C.
  • Stokka, Gerald L.
  • Seeger, Jon T.
  • Grotelueschen, Dale M.

Abstract

Value-added management practices for cow-calf producers have become prevalent as feeders have recognized the value of calves raised with certified health and weaning programs. Export markets requiring age and source verification or non-hormone treated cattle and advancement of markets for naturally raised cattle have also presented profit opportunities for cow-calf producers. This study estimates the value of value-added calf production and marketing programs. Weaned steer calves sold with certified health programs realized $7 to $10 per cwt premiums. Age- and sourceverified steers received $1 to $2 per cwt premiums exceeding added costs of about $0.67 per cwt in 2010 despite rapidly expanding supply.

Suggested Citation

  • Zimmerman, Lance C. & Schroeder, Ted C. & Dhuyvetter, Kevin C. & Olson, K.C. & Stokka, Gerald L. & Seeger, Jon T. & Grotelueschen, Dale M., 2012. "The Effect of Value-Added Management on Calf Prices at Superior Livestock Auction Video Markets," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 37(01), pages 1-16, April.
    • Handle: RePEc:ags:jlaare:122317
    DOI: 10.22004/ag.econ.122317
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/122317/files/Schroeder_%20pg.%20128-143.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.122317?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Bulut, Harun & Lawrence, John D., 2007. "The Value of Third-Party Certification of Preconditioning Claims at Iowa Feeder Cattle Auctions," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 39(3), pages 625-640, December.
    2. Bailey, DeeVon & Hunnicutt, Lynn, 2002. "The Role Of Transaction Costs In Market Selection: Market Selection In Commercial Feeder Cattle Operations," 2002 Annual meeting, July 28-31, Long Beach, CA 19894, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Kevin C. Dhuyvetter & Ted C. Schroeder, 2000. "Price-Weight Relationships for Feeder Cattle," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 48(3), pages 299-310, November.
    4. Schroeder, Ted C. & Tonsor, Glynn T., 2012. "International cattle ID and traceability: Competitive implications for the US," Food Policy, Elsevier, vol. 37(1), pages 31-40.
    5. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    6. Kalyn T. Coatney & Dale J. Menkhaus & John D. Schmitz, 1996. "Feeder Cattle Price Determinants: An Hedonic System of Equations Approach," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 18(2), pages 193-211.
    7. Charles D. Lambert & Mark S. McNulty & Orlen C. Grunewald & Larry R. Corah, 1989. "An analysis of feeder cattle price differentials," Agribusiness, John Wiley & Sons, Ltd., vol. 5(1), pages 9-23.
    8. Gillespie, Jeffrey M. & Basarir, Aydin & Schupp, Alvin R., 2004. "Beef Producer Choice in Cattle Marketing," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 22(2), pages 1-13.
    9. Dhuyvetter, Kevin C., 2004. "Preconditioning Beef Calves: Are Expected Premiums Sufficient To Justify The Practice?," 2004 Annual Meeting, June 30-July 2, 2004, Honolulu, Hawaii 36196, Western Agricultural Economics Association.
    10. Faminow, Merle D. & Gum, Russell L., 1986. "Feeder Cattle Price Differentials In Arizona Auction Markets," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 11(2), pages 1-8, December.
    11. K. K. Lancaster, 2010. "A New Approach to Consumer Theory," Levine's Working Paper Archive 1385, David K. Levine.
    12. Bailey, DeeVon & Peterson, Monte C., 1991. "A Comparison Of Pricing Structures At Video And Traditional Cattle Auctions," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 16(2), pages 1-12, December.
    13. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    14. Schroeder, Ted C. & Mintert, James R. & Brazle, Frank & Grunewald, Orlen C., 1988. "Factors Affecting Feeder Cattle Price Differentials," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 13(01), pages 1-11, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zapata, Samuel D., 2017. "Producers Valuation of Feeder Cattle Characteristics: A Hedonic Model for Heterogeneous Inputs," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 259114, Agricultural and Applied Economics Association.
    2. Schulz, Lee L. & Dhuyvetter, Kevin C. & Doran, Beth E., 2015. "Factors Affecting Preconditioned Calf Price Premiums: Does Potential Buyer Competition and Seller Reputation Matter?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 40(2), pages 1-22, May.
    3. Williams, Brian R. & DeVuyst, Eric A. & Peel, Derrell S. & Raper, Kellie Curry, 2014. "The Likelihood of Positive Returns from Value-Added Calf Management Practices," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 46(1), pages 125-138, February.
    4. Boyer, Christopher & Burdine, Kenny & Rhinehart, Justin & Martinez, Charley, 2020. "Replacing Late Calving Beef Cows to Shorten Calving Season," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 46(2), August.
    5. Mitchell, James & Peel, Derrell S., 2016. "Price Determinants of Bred Cows in Oklahoma Auctions," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230077, Southern Agricultural Economics Association.
    6. Pendell, Dustin L. & Tonsor, Glynn T. & Dhuyvetter, Kevin C. & Brester, Gary W. & Schroeder, Ted C., 2013. "Evolving beef export market access requirements for age and source verification," Food Policy, Elsevier, vol. 43(C), pages 332-340.
    7. Andreas Tsakiridis & Michael Wallace & James Breen & Cathal O'Donoghue & Kevin Hanrahan, 2021. "Beef quality assurance schemes: Can they improve farm economic performance?," Agribusiness, John Wiley & Sons, Ltd., vol. 37(3), pages 451-471, July.
    8. McKendree, Melissa G.S. & Tonsor, Glynn T. & Schulz, Lee L., 2021. "Management of Multiple Sources of Risk in Livestock Production," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 53(1), pages 75-93, February.
    9. Schumacher, Tucker & Schroeder, Ted C. & Tonsor, Glynn T., 2012. "Willingness-to-Pay for Calf Health Programs and Certification Agents," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(2), pages 1-12, May.
    10. Riley, John Michael & Williams, Brian R., 2013. "Cow-Calf Industry Expansion on the Horizon? Market Signals vs. Outside Factors," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 143044, Southern Agricultural Economics Association.
    11. Schulz, Lee L. & Dhuyvetter, Kevin C. & Doran, Beth, 2014. "Factors Affecting Preconditioned Calf Price Differentials: How much do Market and Sale Conditions Matter?," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170570, Agricultural and Applied Economics Association.
    12. Schumacher, Stephanie & Peel, Derrell S. & Raper, Kellie Curry, 2013. "Non-Adoption of Best Management Practices: Demographics and Adoption Constraints of Oklahoma Cattle Producers," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 143094, Southern Agricultural Economics Association.
    13. Allan F. Pinto & Brittney K. Goodrich & William Kelley & Max Runge, 2023. "Price determinants of bred heifers: Do reputations matter?," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 71(1), pages 5-23, March.
    14. Mallory, Shannon & DeVuyst, Eric A. & Raper, Kellie C. & Peel, Derrell & Mourer, Gant, 2016. "Effect of Location Variables on Feeder Calf Basis at Oklahoma Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-13.
    15. repec:ags:joaaec:163228 is not listed on IDEAS
    16. Bina, Justin D. & Schroeder, Ted C. & Tonsor, Glynn T., 2022. "Conditional feeder cattle hedge ratios: Cross hedging with fluctuating corn prices," Journal of Commodity Markets, Elsevier, vol. 26(C).
    17. Williams, Brian R. & DeVuyst, Eric A. & Peel, Derrell S. & Raper, Kellie Curry, 2014. "Reducing Self-Selection Bias in Feeder Cattle Premium Estimates Using Matched Sampling," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 39(01), pages 1-15, April.
    18. Blank, Steven C. & Saitone, Tina L. & Sexton, Richard J., 2016. "Calf and Yearling Prices in the Western United States: Spatial, Quality, and Temporal Factors in Satellite Video Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-23.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:ags:jrapmc:122317 is not listed on IDEAS
    2. Schulz, Lee L. & Dhuyvetter, Kevin C. & Doran, Beth, 2014. "Factors Affecting Preconditioned Calf Price Differentials: How much do Market and Sale Conditions Matter?," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170570, Agricultural and Applied Economics Association.
    3. Blank, Steven C. & Saitone, Tina L. & Sexton, Richard J., 2014. "Seller-Offered Forward Contracts: An Additional Benefit to Cattle Producers from Satellite Video Auctions," 2014 Annual Meeting, February 1-4, 2014, Dallas, Texas 162323, Southern Agricultural Economics Association.
    4. Blank, Steven C. & Saitone, Tina L. & Sexton, Richard J., 2016. "Calf and Yearling Prices in the Western United States: Spatial, Quality, and Temporal Factors in Satellite Video Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-23.
    5. Calil, Yuri Clements Daglia & Ribera, Luis A. & Anderson, David P. & Koury Filho, William, 2022. "Pure-bred Nellore Prices in Brazil: Morphological, Genetic, Physical, and Market Factors in Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 47(3), September.
    6. Williams, Galen S. & Raper, Kellie Curry & DeVuyst, Eric A. & Peel, Derrell S. & McKinney, Doug, 2012. "Determinants of Price Differentials in Oklahoma Value-Added Feeder Cattle Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 37(01), pages 1-14, April.
    7. Williams, Brian R. & DeVuyst, Eric A. & Peel, Derrell S. & Raper, Kellie Curry, 2014. "Reducing Self-Selection Bias in Feeder Cattle Premium Estimates Using Matched Sampling," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 39(01), pages 1-15, April.
    8. Kamuanga, Mulumba & d'Iteren, G & Tano, K & Jabbar, Mohammad A. & Swallow, B M & PoKou, K, 2001. "Farmers’ preferences of cattle breeds, their market values and prospects for improvement in West Africa – a summary review," Research Reports 182892, International Livestock Research Institute.
    9. Tano, Kouadio & Kamuanga, Mulumba & Faminow, Merle D. & Swallow, Brent, 2003. "Using conjoint analysis to estimate farmer's preferences for cattle traits in West Africa," Ecological Economics, Elsevier, vol. 45(3), pages 393-407, July.
    10. repec:ags:jrapmc:122309 is not listed on IDEAS
    11. Yunhan Li & J. Scott Shonkwiler, 2021. "Assessing the Role of Ordering in Sequential English Auctions – Evidence from the Online Western Video Market Auction," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(1), pages 90-105, January.
    12. Allan F. Pinto & Brittney K. Goodrich & William Kelley & Max Runge, 2023. "Price determinants of bred heifers: Do reputations matter?," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 71(1), pages 5-23, March.
    13. Lopez, Jose & Bankole, Taiwo & Wahrmund, Jackie, 2017. "A Hedonic Analysis of Feeder Cattle Auction Prices in Northeast Texas," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252732, Southern Agricultural Economics Association.
    14. Shane, Richard & Janssen, Larry, 1989. "Pricing Variability of Feeder Cattle, Slaughter Cows and Slaughter Bulls at South Dakota Livestock Auctions," WAEA/ WFEA Conference Archive (1929-1995) 244935, Western Agricultural Economics Association.
    15. Mitchell, James & Peel, Derrell S., 2016. "Price Determinants of Bred Cows in Oklahoma Auctions," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230077, Southern Agricultural Economics Association.
    16. Williams, Brian R. & DeVuyst, Eric A. & Peel, Derrell S. & Raper, Kellie Curry, 2014. "The Likelihood of Positive Returns from Value-Added Calf Management Practices," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 46(01), pages 1-14, February.
    17. Blank, Steven C. & Saitone, Tina & Sexton, Richard & Kalotia, Kabir & Forero, Larry & Nader, Glenn, 2011. "Location and distance effects on western calf and yearling prices," 2011 Annual Meeting, June 29-July 1, 2011, Banff, Alberta,Canada 291744, Western Agricultural Economics Association.
    18. repec:ags:joaaec:163228 is not listed on IDEAS
    19. Pierce, Vern L. & Parcell, Joseph L. & Randle, Richard & Patterson, David J., 1999. "Determinants Of Sale Price And Farm Value In The Missouri Show-Me Select Replacement Heifer Program," 1999 Annual meeting, August 8-11, Nashville, TN 21545, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Mallory, Shannon & DeVuyst, Eric A. & Raper, Kellie C. & Peel, Derrell & Mourer, Gant, 2016. "Effect of Location Variables on Feeder Calf Basis at Oklahoma Auctions," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-13.
    21. Schumacher, Stephanie & Peel, Derrell S. & Raper, Kellie Curry, 2013. "Non-Adoption of Best Management Practices: Demographics and Adoption Constraints of Oklahoma Cattle Producers," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 143094, Southern Agricultural Economics Association.
    22. Schulz, Lee L. & Dhuyvetter, Kevin C. & Doran, Beth E., 2015. "Factors Affecting Preconditioned Calf Price Premiums: Does Potential Buyer Competition and Seller Reputation Matter?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 40(2), pages 1-22, May.
    23. Abdullah, Sabah & Mariel, Petr, 2010. "Choice experiment study on the willingness to pay to improve electricity services," Energy Policy, Elsevier, vol. 38(8), pages 4570-4581, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:jlaare:122317. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/waeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.