Ronald Raikes

AN ANALYSIS OF PRODUCERS' YEAR-TO-YEAR CHANGES IN SLAUGHTER-HOG MARKETINGS

Much effort is devoted to explaining and rather than substitute for, analyses based on aggregate forecasting changes in marketings of agricultural data. Results relating actual period-to-period changes commodities. The usual procedure involves formu- by individual producers to their reasons for them may lating hypotheses about behavior of individual pro- complement analyses based on aggregate data. This is ducers, then testing them and quantifying relation- done by identifying factors related to size and ships by using aggregate data. The purpose of this directions of changes, by determining which factors paper is to suggest and illustrate a procedure that may are. particularly important in causing large and small provide a foundation for improved explanation and changes, and by indicating whether and how relative prediction of period-to-period changes in marketings. importance of various factors changes over time. The procedure uses data obtained from indiInformation about characteristics distinguishing vidual producers to test hypotheses about period-to- producers who make frequent period-to-period period changes. Results obtained from an application changes from those who do not may be used to of this procedure (to analysis of year-to-year changes provide additional results. Specifically, trends in these in hog marketings) suggest that expected profitability characteristics may be used to forecast both incidence alone is unlikely to provide either a very complete and magnitude of future production cycles. explanation or accurate predictions of year-to-year An analysis of year-to-year changes in hog changes. marketings illustrates the application of this proceThe procedure suggested in this paper involves dure. Hypotheses about characteristics of producers the following steps. First, hypotheses are formulated making and not making changes, and about factors about period-to-period changes in marketings by related to sizes of year-to-year changes by producers individual producers. These might include hypotheses who do make changes, are developed. Discriminant about characteristics of producers who make and do and regression analysis are applied to data collected not make period-to-period changes. Factors related to from a sample of Iowa hog producers to test these sizes and directions of period-to-period changes by hypotheses. producers who do make them might also be noted. Hypotheses are discussed next, followed by Second, information about hypothesized character- discussions of data and procedures, results and istics distinguishing producers making period-to- conclusions. period changes from those who do not, and information about actual changes and reasons then, is HYPOTHESES obtained from individual producers. Third, these data and appropriate quantitative techniques are used to Hypothesis I test hypotheses and quantify relationships.

Impacts of Market-Share Patterns on Marketing Firm Costs

Uniform market-share patterns have been assumed in specifying cost functions for assembly or delivery operations. A more realistic assumption is that market share decreases with distance from the plant. Procedures for specifying assembly or delivery-cost functions for alternative linear market-share patterns and for determining impacts of changes in market-share patterns on costs and related results are developed and applied in an analysis of anhydrous ammonia retailing. These procedures permit more accurate estimates of cost-volume relationships and make it possible to address questions about how firms should attempt to achieve volume increases.

Weight Loss of Fed Steers during Marketing

Feeding and marketing practices are related to weight loss of fed steers during marketing. Liveweight and carcass weight losses are higher if feed and water are withheld from steers before slaughter. Packers have incentive to require this practice because the liveweight-cost reduction exceeds the value of the lost weight.

CORN PRICES, THE FUEL SHORTAGE AND OPTIMAL CORN HARVESTING STRATEGIES

The unprecedented demand for United States feed grains has boosted corn prices to record levels. If corn prices continue at these record levels, corn production practices and the demand for corn production inputs likely will be affected. One of the corn production practices that may be affected is harvesting. And because of the increased use of field shelling and artificial drying, changes in corn-harvesting practices may have an impact on the demand for propane fuel used in corn drying. Future supplies of propane, however, may be limited, or higher priced, or both. The analysis reported in this paper is an attempt to estimate the impact of higher corn and propane prices on harvesting strategies, on the quantity of propane demanded, and on other related variables. The results of the analysis suggest that, given higher corn prices, the amount of propane demanded for corn drying will increase dramatically, even with much higher propane prices.

A Risk Programming Analysis Of Cattle Procurement By Beef Packers

Shifts in the relative importance of alternative coordination arrangements among agricultural producers and processors, and particularly shifts from spot market transactions to forward contracts or vertical integration, may have substantial impacts on the control of agricultural production and thus may be the target of policy actions. One approach to the problem of identifying trends under way in the relative importance of alternative arrangements is to focus on producer and processor choices among marketing and procurement alternatives.In the study reported in this paper, the cattle-procurement decision problem faced by a beef packer was formulated by using a multi-period, parametric quadratic-programming model. Five alternative arrangements for procuring fed cattle were included in the model: spot purchases, purchases through forward contracts with hedging,purchases through forward contracts without hedging,custom feeding, and packer feeding. Gross margins for procurement alternatives were found to be auto-correlated, and this was taken into account in computing variances of the present values of returns. A major conclusion is that , given the dominance of spot transactions in sales of beef carcasses and by-products, a trend away form reliance on spot purchases of fed cattle and toward vertical integration is not likely. especially for risk-averse packers.