4
with the statement, 4 was neither agree nor disagree, and 7 was strongly disagree. Perhaps
surprisingly, how cattle feeders in the two groups responded to the statements did not differ
significantly, except for a single statement.
Table 3 groups the statements into similar categories. One could argue that mean ratings closer
to 1 and 7 indicated more and less importance, respectively, for the factor believed to affect grid
pricing than those closer to 4, depending on how the statement was presented. While some
comparison is made in the following discussion, recall there was only one significant difference
between the group which used grid pricing for half or less of their marketings in 2003 and the
group that used grid pricing for more than half of the fed cattle marketed from their feedlot that
year. For the group using grid pricing most frequently, factors of most importance were
• when cattle were expected to fit a specific grid
• when cattle were expected to quality grade well
• when cattle were expected to dress well
• when recent experiences with grid pricing were favorable
• when cattle were expected to yield grade well.
Four of the five factors were from the Cattle Characteristics group in Table 3; with the fifth from
the Other Factors group.
Among other factors presented to feeders, those of most importance were
• when there was a wide Choice-Select price difference
• when marketing with an agreement, contract, or part of an alliance or cooperative
• when there was a favorable base price.
Two of these factors came from the Price and Market Conditions group and one from the Other
Factors group in Table 3.
Four of the five factors rated highest by the group using grid pricing the most also were rated
most important by the group not using grid pricing as frequently. The sole statement for which
there was a significant difference in the mean response related to using grid pricing when futures
market prices are relatively stable. This factor was rated more important to the group using grid
pricing less frequently than to the other group.
Mean differences are neither the sole criterion nor perhaps the best one on which to claim no
significant differences among the two groups of cattle feeder respondents. Two nonparametric
tests were also conducted on the rankings of each statement by the two groups. While not shown
here, the only significant difference in rankings of the statements by the two groups according to
the Wilcoxon Scores test (rank sums) or the Spearman Rank Correlation test was, again, for the
statement regarding the relative stability of futures market prices.
Ordinary Least Squares and OrderedLogit Models - Two regression models were specified and
estimated with SAS (SAS Institute); one with extent of grid pricing as the dependent
(continuous) variable in an ordinary least squares model; and one with the extent of grid pricing
group as the dependent (binary choice) variable in an ordered logit model. The ordered logit
model was also estimated with three, four, and five dependent (choice) variables with similar