Muth, Mary K.; Liu, Yanyan; Koontz, Stephen R.; Lawrence, John D.

Journal of Agricultural and Resource Economics Vol. 33 no. 1 (April 2008): 118-135.

Information on prices and price risk differences across marketing arrangements aids fed cattle producers in making choices about marketing methods. As part of the congressionally mandated Livestock and Meat Marketing Study, we investigated fed cattle price and price risk differences across marketing arrangements. The analysis uses data representing cattle purchased by 29 large beef packing plants from October 2002 through March 2005. Results indicate that marketing agreements offered the best trade-off between price level and price risk. Forward contracts had the lowest average yet highly volatile prices. Auction barn prices were higher than other methods but also the most volatile.

JEL Classification: L10

Keywords: alternative marketing arrangements, fed cattle, prices, hedonic, price risk, price volatility