The Likelihood of Positive Returns from Value-Added Calf Management Practices

Brian R. Williams, Eric DeVuyst, Derrell S. Peel and Kellie Raper

Journal of Agricultural and Applied Economics, 2014, vol. 46, issue 1, 125-138

Abstract: Extension faculty have been educating cow-calf producers about value-added calf management programs and the premiums available at auction from these management practices for years. Despite these efforts, producers express doubt regarding the likelihood of premiums and the profitability of value-added management practices. We use matching pairs to calculate the difference in premiums and net returns between adopters and nonadopters and calculate the likelihood of positive net returns (and premiums) for individual practices and practice bundles. The probability of positive net returns ranges from 57% for dehorning to 79% for a certified vac-45 program (calves certified by a third party to be preconditioned for a minimum of 45 days, vaccinated, and dehorned) and probabilities increase with more practices adopted.

Date: 2014
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