Price Signals as Indicators of Profitability at Various Stages of Production in Oklahoma Beef

Cow-calf producers face an annual decision on when to sell their calves. They can sell them at any point between weaning and slaughter, with the objective of finding the profit maximizing selling point. This paper investigates the use of price signals to determine profit maximizing selling points/retention strategies. Three retention strategies, one for fall calving and two for spring calving, are considered. Producers can sell their calves at weaning, after preconditioning, after grass pasture, after wheat pasture, or after the feedlot depending on the retention strategy. These price signals indicate the optimal selling point based on an observable price ratio at weaning. This paper also considers factors such as the level of preconditioning premiums and the length of the preconditioning period required to impact the profit maximizing selling point.