Effect of Location Variables on Feeder Calf Basis at Oklahoma Auctions
By: Mallory, Shannon; DeVuyst, Eric A.; Raper, Kellie C.; Peel, Derrell; Mourer, Gant
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Citation
Mallory, Shannon; DeVuyst, Eric A.; Raper, Kellie C.; Peel, Derrell; Mourer, Gant, Effect of Location Variables on Feeder Calf Basis at Oklahoma Auctions, Journal of Agricultural and Resource Economics, Volume 41, Issue 3, September 2016, Pages 393-405
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Abstract
Past research has reported differences in feeder cattle prices received due to location of sale barns, but little is reported on the source of those differences.We developed a feeder calf hedonic pricing model that includes location-specific characteristics. Local factors may affect transaction costs for buyers and sellers, impacting the basis. Results show that basis increased $0.64/cwt for every 100,000 acres of wheat within a 100-mile radius. Basis decreased $0.07 per mile from four-lane roads. Basis decreased $1.99 per 1% of value-added volume. The impact of lot size, weight, hide color, frame, gender, and other phenotypic characteristics were also analyzed.