Document Type

Article

Publication Date

9-12-2001

Keywords

steer calves, livestock markets, cattle production, cattle ownership

Abstract

Marketing and production data collected from weaned calves (628 head) in a university sponsored retained ownership demonstration program are analyzed to identify factors affecting the annualized rate of return when retaining ownership versus selling the calves at weaning. Data were collected on the following characteristics associated with the calves: 1) ranch-of-origin production management practices; 2) feedlot performance; 3) carcass merit; 4) health history; and 5) market prices. Retained ownership until slaughter was more profitable, on average, when compared to selling calves at weaning. The calculated annualized rate of return to retained ownership versus selling calves at weaning averaged 11.5% per head. Regression analyses indicate that market prices paid for weaned calves and fed cattle have the greatest influence on the rate of return to retained ownership. The other five categories (ranch-of-origin, production management practices, feedlot performance, carcass merit, health history) also contributed to explaining the variability in the rate of return per head. Marketing and production risks were not incorporated into the regression model. However, summary statistics indicate that coefficient of variation associated with per-head retained ownership revenue is 50% higher than the estimated per-head revenue for weaned calves.

Publisher

Department of Economics, South Dakota State University

Series Number

2001-05

Number of Pages

19

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