An analysis of more than 1400 pens of
cattle marketed during 1990 examined the
influence of several cattle traits and marketing
factors on fed cattle prices. Cattle quality
grade had an important impact on packer bids
and feedyard asking prices. However, both
feedyard asking and packer purchase prices
reflected less than 25%, on average, of estimated
wholesale value differentials. Other
factors, including estimated dressing percentage,
finish uniformity, cattle weight, number
of head purchased, presence of heiferettes, and
cattle type had significant price impacts.
Feedyards generally received what they asked
for cattle; 65% of the pens sold for their
asking prices. Price signals for differences in
cattle "quality" are not fully transmitted to
cattle feeders.
