CORN PRICE EFFECTS ON COST OF GAIN FOR FEEDLOT CATTLE: IMPLICATIONS FOR BREAKEVEN BUDGETING

John Anderson and James N. Trapp

Journal of Agricultural and Resource Economics, 2000, vol. 25, issue 2, 11

Abstract: Elasticities calculated from an econometric model of cost of gain (COG) for cattle in feedlots indicate that COG is considerably less responsive to corn price changes than breakeven budgets assume. This difference in elasticities can lead to substantial errors in COG estimates obtained from budgeting. Size of error will depend upon the initial corn price and the magnitude of corn price change. Given average corn price levels and month-to-month changes, the error in budget-based net revenue projections will be about $3/head.

Keywords: Livestock; Production/Industries (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlaare:30896

DOI: 10.22004/ag.econ.30896

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