| Quality grade, yield grade, and other feedlot performance factors explain much of the variation in profit under grid pricing. Thus, feedlot owners can change profits by adjusting time on feed to influence these performance factors. This research uses growth models, logistic regression, and an optimization process to determine how the optimal number of days on feed changes under different grid pricing structures. It was found that large quality or small yield discounts increases the optimal number of days on feed and small quality or large yield discounts result in fewer days on feed. Losses associated with a grid having large quality discounts are minimized as cattle fed for more days are able to obtain Choice premiums despite the discounts for more Yield... |
