Third-Party Verified Preconditioning Programs Pay
Cattlenetwork.com
A recent study conducted by Iowa State University showed buyers are willing to pay more for cattle preconditioned through a program that is backed by a third party. The study found a $2.75 difference in the premium given for calves preconditioned through third-party-verified programs versus those with unverified claims.
Dr. John Lawrence, professor of economics, Iowa State University Extension, conducted this study to get to the root of a pricing problem. He says the issue is that buyers cannot easily determine the quality of cattle. And, it is to the sellers’ advantage to overstate the condition of their animals. “Our purpose was to look at the value in the amount and the source of the preconditioning information sellers attach to calves,” Dr. Lawrence says. “We know that buyers are willing to pay extra for management practices required for preconditioning, but we wanted to know if they are willing to pay even more for claims that are certified by a third party.”
