Schulz, Lee L.

By: Pudenz, Christopher C.; Schulz, Lee L.
Changing market fundamentals have made fed dairy cattle basis more variable. Our study estimates empirical models of fed dairy basis and utilizes tests that endogenously identify structural breaks following one large packer's decision to exit the fed dairy cattle market. We quantify the impact and find sale type, cattle weight, seasonality, ground beef prices, by-product values, and fed cattle slaughter capacity utilization to be important basis determinants, although the impact of some of these factors has changed over time. Finally, we assess multiyear moving average basis forecast accuracy and draw implications for formulating basis expectations.
By: Schulz, Lee L.; Dhuyvetter, Kevin C.; Doran, Beth E.
Feeder-calf prices are determined by the interaction of many factors. This study uses transaction data from Iowa preconditioned and regular feeder-calf auction sales to quantify the impact of a wide variety of factors, several of which have not been used in previous studies on feeder-calf prices. Notably, market premiums for preconditioned sales versus regular sales, feedlot capacity utilization, and seller reputation are found to be significant factors affecting feeder-calf prices. Estimated coefficients are then used to predict prices to demonstrate how this information can be used in making management and marketing decisions.
By: Schulz, Lee L.; Schroeder, Ted C.; Ward, Clement E.
Price differences among fed cattle prices in Canada and the United States (referred to here as fed cattle basis) are important for Canadian cattle feeders, but changing government regulations in Canada and the United States have made basis more variable. This article uses transaction data from Canadian feedlots to quantify fed cattle price differentials in light of new policy initiatives. Using transaction prices, we find that differing slaughter regulations, labeling laws, and policies affecting access to U.S. markets for Canadian cattle affect fed cattle basis.