Effect of Location Variables on Feeder Calf Basis at Oklahoma Auctions

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.

Keywords

• feeder calf basis
• hedonic pries
• location variables