Price Differences Due to Preconditioning of Beef Calves Compared to Traditional Marking in Alabama from 2012-2016.

Preconditioning has potential to bring higher economic returns for cow-calf producers from feeder calves if preconditioning is cost-effective. The objective of this study was to find out the price differences between traditional marketing and value added marketing (preconditioning or board sales) of beef calves in Alabama from 2012 to 2016. The sales data were collected from the USDA-AMS (Agricultural Marketing Services) field office at Montgomery, Alabama for both traditional marketing (auctions) and value added marketing. There were 20 locations for traditional marketing while board sales data were collected from 3 locations. Of the total calf sales, only 23% calves were sold through board sales. Sales data were collected from 585 lots (farmers) representing 118,125 head of calves sold between January 2012 and December of 2016 at different auctions and board sales. The data consisted of auction types, gender, muscle scores, and average weight (range: 250 kg to 386 kg) but the breeds of feeder calves were not considered. Data were analyzed by a General Linear Model Procedures of SAS to determine the price difference associated with sales type including all variables listed above. However, the economic values of preconditioning were not determined. The analyzed data showed that beef calf prices differed significantly (P <0.05) between market types (auction vs. board sales), years, gender, muscle scores, and average weights. The overall yearly averages were $121.48, 137.40, 211.32, 206.37, and 126.52 for 45.4 kg live weights for years 2012, 2013, 2014, 2015, and 2016, respectively. Steers sold at board sales with an average body weights of 250 kg brought $32/45.4 kg more than those sold traditionally at the same body weight but the difference narrowed as body weight increased to 318 kg body weight and the difference being $21.44/45.4 kg only. When values for market types (auction and board sales) were combined, the values for muscle scores were $164.25, 168.02, 158.99, and 151.19 for 1, 1 and 2 combined, 2 and 3 muscle scores, respectively. Similarly, the values for gender were $157.60, 156.11, and 168.13 for bulls, heifers, and steers, respectively. The year 2014 was the best year for beef calf prices in Alabama regardless of auction types. The results of this study suggest that there are price differences between the traditional marketing and board sales (preconditioning) of calves, however, the net profits due to auction types needs to be investigated further to demonstrate the economic benefits of preconditioning calves.