The value of muscle score in beef cattle auction markets

There is an increasing emphasis in Australia on finding ways to improve retail beef yield, but no current way to commercially measure retail yield. However there is a strong link between muscle score of the live animal as assessed in live cattle markets and subsequent meat yield measurements. Is there a credible value for muscle score in live cattle markets, and does it reflect the implied value of increased retail yield? In this paper these questions are investigated using price data from some 550 lots of male cattle sold at Wagga Wagga saleyard during the period July 2010 to June 2011. Two different types of hedonic models are applied and tested against each other. The premium for muscle score seems to have stayed at around 12- 14 per cent of the base price after the initial jump from 7.5 per cent in 1990, although for particular categories of animals, interactions between muscle score, fat score and age are important, and premiums and discounts are more like 5-6 per cent of the base price.Premiums and discounts for muscle score evident in cattle saleyard prices are over-estimates of the eventual increase in retail value, according to the assumptions made in this paper.