Examination of Received Prices Between Replacement Heifers and Feeder Heifers in Alabama

Abstract

A constant source of beef replacement heifers is essential. Consignors perceive replacement quality heifers are worth more than feeder heifers. This study examined what factors affected prices received for replacement heifers versus feeder heifers in Alabama. Factors examined included sale name, sale year, adjusted 205-d weight, weaning weight ratio, age of heifer at time of sale, and sire breed. Data for this study came from 5 different consignment replacement heifer sales across Alabama across various years. Average stockyard prices for the particular month and year the sale occurred in were obtained to make the comparison between replacement and feeder heifers. The 5 sales studied were Alabama Beef Cattle Improvement Association (AL BCIA) heifer sales featuring open heifers with performance data and known genetics and ages. Nine sire breeds were represented in the study. These included Angus, Brahman, Brangus, Charolais, Gelbvieh, Hereford, Limousin, Simangus, and Simmental. The Angus sire breed was used as a basis for comparison since this sire breed was present in all sales. Angus was also the sire breed with the greatest number of heifers present in the sample size. The overall model used to test the entire data set included fixed effects of sale name, consignor nested within sale name and sale year, and sire and dam breeds. Covariates of age of heifer at sale, adjusted 205-d weight, and weaning weight ratio were used. Dam breed and adjusted 205-d weight had P-values P > .05 indicating these 2 factors were not significant sources of variation. These results indicate buyers paid more for older heifers with a greater weaning weight ratio. The final model accounted for 88% of the total variation of replacement heifer sale price (R2 = 0.884). Comparisons between Angus and the other breeds showed Angus and each of the other breeds sold for statistically the same price in each of the sales where both breeds were represented. With the sale name comparisons, Angus and each of the other breeds sold for the same price regardless of sale name. One exception was Simangus where the average sale price for Angus and Simangus heifers was statistically different (P < .05) between all 4 sales with heifers sold at Ag-O-Rama selling for a higher price than those sold at Chilton County BCIA Heifer Sale, Producers BCIA Heifer Sale, and Herd Builders Replacement Heifer Sale. KEY WORDS: Beef cattle, Heifer, Profit Margin