This research was intended to shed light on factors affecting grid pricing use by cattle feeders.
While providing some insight and generating additional information not available in prior grid
pricing research, results generally were unremarkable. Feedlot managers have several reasons to
use grid pricing and the ones hypothesized to be potentially important in the feedlot survey were
not strongly related to feedlot location, size, and extent of custom feeding. Neither was extent of
grid pricing consistently related to many factors hypothesized by economists to influence the
extent of grid pricing. It appears, each feedlot assesses its own management objectives and
market-related factors in determining how to price fed cattle. Attempting to formulate policies
aimed at enticing cattle feedlot managers to use or not use specific types of pricing methods (for
whatever reasons), seems difficult due to the diversity of pricing behavior and diverse reasons
for choosing their pricing methods.
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