FED CATTLE SPATIAL TRANSACTIONS PRICE RELATIONSHIPS

Delineation of geographic markets for fed cattle is essential in monitoring price behavior and determining geographic markets. This study uses transactions data from 28 U.S. fed cattle slaughter plants to determine the extent of the geographic market for fed cattle. Results indicate a national market for fed cattle with prices across most plants cointegrated. In addition, price discovery originates predominantly at plants located in Nebraska, and typically one-third of the total price adjustment to spatial integration occurs in one day.Cointegration, Relevant market, Spatial prices, Demand and Price Analysis, Livestock Production/Industries,

HEDGING WHOLESALE BEEF CUTS

Live cattle futures markets do not offer much opportunity for effective hedging of wholesale beef cuts. If a Choice-to-Select price spread futures contract were introduced this would enhance hedging effectiveness although likely not enough to encourage cross hedging. If a Choice boxed beef futures contract were introduced, hedging Choice wholesale beef cuts would be less risky and the addition of a Choice-to-Select price spread would enhance hedging effectiveness especially for Select wholesale beef cuts.Livestock Production/Industries, Marketing,

EFFECTS OF ADDITIONAL QUALITY ATTRIBUTES ON CONSUMER WILLINGNESS-TO-PAY FOR FOOD LABELS

Contingent valuation (CV), choice experiment (CE) and experimental auction (EA) or the combinations of the three methods are often used by researchers to elicit consumer willingness to pay for food attributes (food labels). One concern about using these approaches is that quality attributes of food provided to respondents are assumed independent of other attributes which are not provided to respondents during the survey. The limited attributes provided in a survey may lead respondents to allocate their budgets to those limited attributes rather than allocate their budgets to a larger number of product attributes to truly reveal their preferences. Surveys containing a series of online CEs were collected to investigate the effects of additional beef steak attributes on consumer WTP in two different US markets. Random parameters logit models are estimated for each CE in the questionnaires with survey results from both samples. The models with the different survey samples reveal consistent results regarding changes in WTP with more attributes added to the CEs. Consumer WTP for the most important attributes in the CE decreases when the number of attributes increases from three to four, while the WTP for the most important attributes increases when the number of attribute increase from four to five. The changes in the WTP for attributes depend on their relationships with the newly added attributes to the CEs and the number of attributes in CEs.Food Labels, Willingness-to-Pay, Choice Experiment, Demand and Price Analysis,

DETERMINANTS OF FEEDER CATTLE PRICE-WEIGHT SLIDES

Feeder cattle price-weight slides are analyzed using transactions data on 46,123 pens of feeder cattle over a 10-year period. Fed cattle futures prices and corn prices are important determinants of price-weight slides. Cattle producers can use this information when making sell timing decision, purchase decisions, and managing production.Livestock Production/Industries,

GRID PRICING: VALUING CATTLE QUALITY INFORMATION

Grid pricing is increasingly prominent in cattle markets. This study compares selling 11,703 head of fed cattle using grid, live, and dressed weight pricing. Cattle sold on a grid had price variability twice that of live or dressed. Average pricing inefficiency by not selling cattle on a grid exceeded $30/head.Demand and Price Analysis, Livestock Production/Industries,

Impact of Mandatory Price Reporting on Fed Cattle Market Integration

Geographic fed cattle markets are important because cattle are bulky and perishable, and production and consumption areas are separated. These characteristics make cattle transportation costly and can contribute to segmented markets. This study uses USDA-AMS reported fed cattle market price data from five U.S. regional fed cattle markets to investigate the effects of mandatory price reporting on spatial market integration. Results indicate these markets have been, and remain, highly cointegrated after implementation of mandatory price reporting (MPR). Following introduction of mandatory price reporting, the five regional fed cattle markets have become more fully integrated (i.e., prices tend to move more closely one-for-one following introduction of MPR).cattle markets, cointegration, mandatory price reporting, market integration, regime shift, Livestock Production/Industries, Marketing,

Price Dynamics in International Wheat Markets

Vector autoregressions are used to evaluate dynamic relationships among prices in six important international wheat markets. The effects of freight rates and exchange rates are also considered. The results indicate that Canada is the dominant market, supporting views that Canada is an oligopolistic price leader.international trade, vector autoregressions, wheat markets, International Relations/Trade,

Determinants of Beef and Pork Brand Equity

A set of consumer-level characteristic demand models were estimated to determine the level of brand equity for pork and beef meat cuts. Results indicate that brand premiums and discounts vary by private, national, and store brands; and brand equity varies across meat cuts carrying the same brand name. Other results are that product size discounts are linear, meat items on sale are significantly discounted to non-sale items, specialty stores typically do not garner higher prices than supermarket/grocery store, and warehouse/super center stores typically premium price to supermarket/ grocery store.Demand and Price Analysis,

Effects of Meat Recalls on Futures Market Prices

The number of meat recalls has increased markedly in recent years. This research examines the impact of beef and pork recall announcements on nearby daily live cattle and lean hog futures market prices, respectively. Results indicate medium-sized beef recalls that are of serious health concerns have a marginally negative impact on short-term live cattle futures prices. However, results are not robust across recall size and severity. This research suggests that if there is any systematic change in cattle and hog demand due to meat recalls, it likely occurs over an extended period of time and only in certain cases does it noticeably affect daily futures prices.Agribusiness, Food Consumption/Nutrition/Food Safety,

ARE CATTLE ON FEED REPORT REVISIONS RANDOM AND DOES INDUSTRY ANTICIPATE THEM?

Cattle on Feed (COF) reports are an important source of beef supply information. This study investigates whether COF report revisions are unbiased, random, and anticipated. Initial COF reports are biased, but the bias is economically small. Revisions to COF estimates are not random. Market analysts do not correctly anticipate revisions.Livestock Production/Industries,