"We found third-party certification (TPC) of preconditioning claims (certified vaccination and at least 30 days weaning claims) receives a significantly higher premium than similar uncertified claims (both in statistical and economic sense)," say Iowa Beef Center (IBC) researchers. "The difference exceeds the unit-participation cost of TPC on average. This shows the TPC in preconditioning claims is supported in the market. It also shows significant value can be lost if information isn't trusted and/or not delivered to the market, even if all work is really done."

This is based on recently published results of an IBC study examining 105 sales in nine Iowa auction markets between Oct. 20, 2005, and Feb. 24, 2006. Researchers looked at such market variables as sex, lot size and all of the rest, but also constructed the study to look at price differences between calves preconditioned and documented in various ways.

Overall, this is what they found when comparing to a base lot defined as a heifer, dehorned, non-black, not fleshy, healthy and clean calves without vaccination and weaning claims:

  • Category 1: Calves with certified vaccination claims and weaned at least 30 days had a premium of $6.15/cwt. over the base. These calves were mostly Iowa Green Tag Preconditioned, but also included Iowa Gold Tag (nearly 10%) or other similar private programs (5%).
  • Category 2: Calves with uncertified claims (the seller's word) of vaccinations and at least 30 days weaning received $3.40/cwt. more than the base. The relative premium between this category and the first category was $2.75/cwt., which is statistically significant (p-value< 0.0001).
  • Category 3: Calves with vaccinations but without 30 days weaning claim (either no date mentioned or mentioned that weaned less than 30 days) received $3.14/cwt. more than the base. This premium is statically different than the first category (with p-value 0.0001) but not different from the second category (with p-value 0.22).
  • Category 4: Calves with only vaccination claims received $2.42/cwt. more than the base.
  • Category 5: Calves with only weaning claims received $1.70/cwt. more than the base. The premiums in fourth and fifth categories are statistically different than each other at the 5% level of significance. They are also different from the premiums in the first, second, and third categories at the 1% level of significance.
In summary, say the researchers, "More practices and information receive a higher premium than less, and third-party certification is worth more than the seller's claim."

You can find complete details at: www.iowabeefcenter.org/content/IBC30.pdf