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Abstract

The impacts of meat pricing on selected financial results for the Cattlemen's Texas Longhorn Beef Cooperative, Inc. were investigated in a stochastic simulation model. Triangular price distributions for boxed beef and various carcasses categories were specified for each month and correlated, based on 2000 USDA carlot meat report data. Hot-carcass weights were also modeled as triangular distributions. At 5,000 head and with meat prices 12% over USDA prices the probability of net profits before taxes (NPBT) falling below $0 was 1.3%. At 10,000 head and payments 9% over USDA prices there was an 11.8% chance of NPBT falling below $0.

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