FACTORS AFFECTING FEEDER CATTLE PRICE DIFFERENTIALS

Abstract

Feeder cattle prices are determined by the interaction of many factors. This study uses 1986 and 1987 Kansas feeder cattle auction data to investigate the impact of a wide variety of physical characteristics, many of which have not been used in previous studies on feeder cattle prices. Unlike previous studies, this analysis explicitly incorporates changes in feeder cattle market fundamentals during the data collection period and also allows price differentials to vary by sex and weight. Weight, weight-squared, lot size, lot size-squared, health, muscling, frame size, condition, fill, breed, presence of horns, and time of sale are significant factors affecting feeder cattle prices on any given day. Several physical traits also exhibit different seasonal price impacts.Demand and Price Analysis, Livestock Production/Industries,