An Ohio State University study investigated the use of crossbreeding dairy cows to increase the value of male dairy calves for the production of a high-quality beef product. For more information on this visit the MSU Extension dairy and beef pages.ĭairy bull calves are commonly sold at livestock auctions, and in some cases, for a loss or very little financial return to the dairy farmer. These bull calves are a by-product of the dairy enterprise, as very few are left intact to reach sexual maturity and breed cows. The use of conventional, unsexed semen will result in approximately 50% of the calves being heifers, some of which can be raised for replacements in the milking herd, and approximately 50% of the calves will be bulls. The RAE is published quarterly.Dairy cows need to give birth to begin producing milk. The Review of Agricultural Economics is published jointly by the Southern Agricultural Economics Association, the Northeastern Agricultural and Resource Economics Association, the Western Agricultural Economics Association, and the American Agricultural Economics Association. The editors take seriously the challenge to evaluate manuscripts for publication based on readability and broad interest to all subscribers. In this regard, this publication is unique among the scholarly agricultural economics journals. Published articles are expected to be valuable to applied economists working in the public, private, and nonprofit sectors, both domestic and international. These areas include extension education, resident instruction, applied economic and policy analysis, and decision-support analysis. The purpose of the Review of Agricultural Economics (RAE) is to provide a forum for the exchange of ideas and empirical findings among those working in various areas of agricultural economics. The system approach used in this study can reduce the confounding influences measured by estimated coefficients in a single-equation approach due to interdependencies among characteristics and resulting collinearity. An implication of the analysis is that feeder cattle sellers must account for the direct, as well as the indirect, impacts of cattle and seller-added characteristics in order to determine buyer preferences. For the seller-added characteristics and market factors, the most influential indirect price impacts occurred via weight. The most prominent estimated indirect price impacts for feeder cattle resulting from a changes in physical characteristics was through the direct impacts on the frame score and weight. Three-stage least squares was used to estimate the model. A probit model was used to generate an Inverse Mill's Ratio for each lot of cattle sold to correct for possible selectivity bias. Data used for the analysis were obtained from Superior Livestock Satellite Video Auction located in Brush, Colorado. The empirical model formulated for feeder cattle in this study includes physical characteristics, market factors, marketing techniques, seller-added characteristics, climate/environment influences, and seller characteristics along with their possible interdependencies. The recognition of the interdependence of selected feeder cattle characteristics results in both indirect and direct influences of characteristics on price. The objectives of this research were to statistically account for selected characteristic interdependencies that may be associated with the pricing decisions of feeder cattle buyers and to determine the magnitudes of direct, total indirect, and total price impacts of selected interrelated and independent factors on the overall price paid for a lot of feeder cattle. Characteristics supplied by a lot of cattle, along with outside market factors and various contractual conditions, contribute to the overall price paid for a particular lot of cattle.
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