The issue of cattle marketing has generated much debate and division within the industry. Without question its marketing system continually evolves and is becoming more rational in the way prices are allocated based on value. Conversely, marketing can also be seen as inefficient where prices are forced towards the average. The industry finds itself within a perfect storm -- where consumers are making increasing demands on the product they are buying and are increasingly willing to vote with their dollars based on those preferences.
In particular, the premiums for hide color have attracted industry attention and discussion. Upon analysis, the premium for black-hided cattle reveals an interesting story about the adoption of Angus genetics and premiums seen in the marketplace. While not perfect, black hides do tell a story of higher value cattle – cattle that grade well and earn premiums on the other end. But that’s not the whole story. There’s a need continue to improve the system and the market is poised to do that.
In this paper, Troy Marshall and other industry professionals provide an analysis on market data and these trends. Read “Value Determination in the Feeder Cattle Market.”