IDEAS home Printed from https://ideas.repec.org/a/cup/jagaec/v32y2000i03p493-505_02.html
   My bibliography  Save this article

The Dynamics of Feeder Cattle Market Responses to Corn Price Change

Author

Listed:
  • Anderson, John D.
  • Trapp, James N.

Abstract

A feeder-calf price model is estimated which incorporates elements of break-even budget analysis, including estimates of placement weights, slaughter weights, ration cost, and feed-conversion rates. From this model, a corn price multiplier is calculated which quantifies the corn/feeder-calf price relationship. Because the multiplier includes information on cattle weight, feed conversion, and ration cost, it also provides insight into how feeding programs are altered in response to corn price changes. Changes in feeding programs which occur in response to corn price changes are illustrated with dynamic simulation based on weight, ration cost, and price models presented here.

Suggested Citation

  • Anderson, John D. & Trapp, James N., 2000. "The Dynamics of Feeder Cattle Market Responses to Corn Price Change," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 32(3), pages 493-505, December.
    • Handle: RePEc:cup:jagaec:v:32:y:2000:i:03:p:493-505_02
    as

    Download full text from publisher

    File URL: https://www.cambridge.org/core/product/identifier/S1074070800020599/type/journal_article
    File Function: link to article abstract page
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Langemeier, Michael R. & Schroeder, Ted C. & Mintert, James R., 1992. "Determinants Of Cattle Finishing Profitability," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(2), pages 1-7, December.
    2. Steven T. Buccola, 1980. "An Approach to the Analysis of Feeder Cattle Price Differentials," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(3), pages 574-580.
    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. Schmit, Todd M. & Verteramo, Leslie & Tomek, William G., 2009. "Implications of Growing Biofuel Demands on Northeast Livestock Feed Costs," Agricultural and Resource Economics Review, Cambridge University Press, vol. 38(2), pages 200-212, October.
    2. 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.
    3. Hardin, Dan & Saghaian, Sayed, 2014. "Factors that Affect Seasonality in Kentucky Feeder Calf Prices and How Calving Dates Affect Cow-Calf Enterprise Profitability," 2014 Annual Meeting, February 1-4, 2014, Dallas, Texas 162495, Southern Agricultural Economics Association.
    4. Augusto Hauber Gameiro, 2022. "Factors Defining Prices of Finished Cattle in Mato Grosso Contrasted Within Brazil’s Pricing Structure," Journal of Agricultural Studies, Macrothink Institute, vol. 10(4), pages 218-235, December.
    5. Huan Zhao & Xiaodong Du & David Hennessy, 2011. "Pass-through in United States beef cattle prices: a test of Ricardian rent theory," Empirical Economics, Springer, vol. 40(2), pages 497-508, April.
    6. Maples, Joshua G. & Harri, Ardian & Riley, John Michael & Tack, Jesse B., 2013. "Marketing Margins and Input Price Uncertainty," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150604, Agricultural and Applied Economics Association.
    7. 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.
    8. Mathews, Kenneth H., Jr. & Arnade, Carlos Anthony & Jones, Keithly G., 2008. "Derived Demand for Cattle Feeding Inputs," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 26(1), pages 1-20.
    9. Schmit, Todd M. & Verteramo, Leslie & Tomek, William G., 2007. "Biofuel Demands: Their Implications for Feed Prices," Working Papers 179943, Cornell University, Department of Applied Economics and Management.
    10. Brake, William & Anderson, John D. & Coffey, Brian K., 2006. "Geographic and Seasonal Differences in the Feeder Cattle Hedging Risk," 2006 Annual Meeting, February 5-8, 2006, Orlando, Florida 35325, Southern Agricultural Economics Association.
    11. Burdine, Kenneth H. & Halich, Greg, 2014. "Payout Analysis of Livestock Risk Protection Insurance for Feeder Cattle," Journal of the ASFMRA, American Society of Farm Managers and Rural Appraisers, vol. 2014, pages 1-14.
    12. Tejeda, Hernan A. & Goodwin, Barry K., 2009. "Price Volatility, Nonlinearity, and Asymmetric Adjustments in Corn, Soybean, and Cattle Markets: Implications of Ethanol-Driven (Market) Shocks," 2009 Conference, April 20-21, 2009, St. Louis, Missouri 53039, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    13. Koirala, Krishna H. & Mishra, Ashok K. & D'Antoni, Jeremy M. & Mehlhorn, Joey E., 2015. "Energy prices and agricultural commodity prices: Testing correlation using copulas method," Energy, Elsevier, vol. 81(C), pages 430-436.
    14. Belasco, Eric J., 2008. "The Role of Price Risk Management in Mitigating Fed Cattle Profit Exposure," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(3), pages 1-17.
    15. Swanser, Kole, 2013. "Dynamics of Feeder Cattle Basis and Price Slides," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150249, Agricultural and Applied Economics Association.
    16. Burdine, Kenneth H. & Maynard, Leigh J. & Halich, Greg, "undated". "Factors Affecting Feeder Cattle Prices in the Southeast," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 142976, Southern Agricultural Economics Association.
    17. Janzen, Matthew & Coatney, Kalyn T. & Rivera, Daniel & Harri, Ardian & Riley, John Michael & Busby, Darrell & Groves, Matt, "undated". "Fed Cattle Marketing: A Field Experiment," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252844, Southern Agricultural Economics Association.

    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. Mark, Darrell R. & Schroeder, Ted C. & Jones, Rodney D., 2000. "Identifying Economic Risk In Cattle Feeding," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 18(3), pages 1-14.
    2. Avent, R. Keith & Ward, Clement E. & Lalman, David L., 2004. "Market Valuation of Preconditioning Feeder Calves," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 36(1), pages 1-11, April.
    3. McBride, William D., 1997. "Change in U.S. Livestock Production, 1969-92," Agricultural Economic Reports 262047, United States Department of Agriculture, Economic Research Service.
    4. Fantu Bachewe & Derek Headey & Bart Minten, 2023. "Price predictors in an extended hedonic regression framework: An application to wholesale cattle markets in Ethiopia," Agricultural Economics, International Association of Agricultural Economists, vol. 54(2), pages 289-306, March.
    5. Mintert, James & Blair, Joanne & Schroeder, Ted & Brazle, Frank, 1990. "Analysis of Factors Affecting Cow Auction Price Differentials," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 22(2), pages 23-30, December.
    6. Jones, Rodney D. & Schroeder, Ted C. & Mintert, James R. & Brazle, Frank, 1992. "The Impacts Of Quality On Cash Fed Cattle Prices," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(2), pages 1-14, December.
    7. Babetskaya, Lyubov, 2001. "Enhancing The Performance Of Risk-Rating Models At Community Banks," 2001 Annual meeting, August 5-8, Chicago, IL 20690, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Avent, R. Keith & Ward, Clement E. & Lalman, David L., 2002. "Asymmetric Value Of Preconditioning Programs For Feeder Cattle," 2002 Annual Meeting, July 28-31, 2002, Long Beach, California 36559, Western Agricultural Economics Association.
    9. Brester, Gary W. & Marsh, John M., 2001. "The Effects Of U.S. Meat Packing And Livestock Production Technologies On Marketing Margins And Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(2), pages 1-18, December.
    10. Forristall, Cody & May, Gary J. & Lawrence, John D., 2002. "Assessing The Cost Of Beef Quality," 2002 Conference, April 22-23, 2002, St. Louis, Missouri 19060, NCR-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    11. Belasco, Eric J. & Taylor, Mykel R. & Goodwin, Barry K. & Schroeder, Ted C., 2009. "Probabilistic Models of Yield, Price, and Revenue Risks for Fed Cattle Production," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 41(1), pages 1-15, April.
    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. Langemeier, Michael R. & Schroeder, Ted C. & Mintert, James R., 1992. "Determinants Of Cattle Finishing Profitability," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(2), pages 1-7, December.
    14. Lawrence, John & Wang, Zhi & Loy, Dan, 1999. "Elements of Cattle Feeding Profitability in Midwest Feedlots," ISU General Staff Papers 199901010800001486, Iowa State University, Department of Economics.
    15. Jones, Rodney D. & Kastens, Terry L., 1999. "Predicting Feeding Cost Of Gain With More Precision," 1999 Annual meeting, August 8-11, Nashville, TN 21506, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    16. Turner, Steven C. & Dykes, Nancy S. & McKissick, John C., 1991. "Feeder Cattle Price Differentials In Georgia Teleauctions," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 23(2), pages 1-10, December.
    17. Paul Harris & Bruno Lanfranco & Binbin Lu & Alexis Comber, 2020. "Influence of Geographical Effects in Hedonic Pricing Models for Grass-Fed Cattle in Uruguay," Agriculture, MDPI, vol. 10(7), pages 1-17, July.
    18. Mare, Frikkie A. & Nell, Wilhelm T. & Willemse, B.J., 2010. "Maize prices in South Africa: Can the producer increase his revenue by marketing grain through cattle?," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 96646, African Association of Agricultural Economists (AAAE).
    19. Rahman, Shaikh Mahfuzur, 2006. "Optimal Incentive Structure in Cattle Feeding Contracts Under Alternative Fed Cattle Pricing Methods," Working Papers 28549, University of Maryland, Department of Agricultural and Resource Economics.
    20. Melissa G. S. McKendree & Glynn T. Tonsor & Ted C. Schroeder & Nathan P. Hendricks, 2020. "Impacts of Retail and Export Demand on United States Cattle Producers," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(3), pages 866-883, May.

    More about this item

    Statistics

    Access and download statistics

    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:cup:jagaec:v:32:y:2000:i:03:p:493-505_02. 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: Kirk Stebbing (email available below). General contact details of provider: https://www.cambridge.org/aae .

    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.