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Impacts of Declining U.S. Retail Beef Demand on Farm‐Level Beef Prices and Production
Author(s) -
Marsh John M.
Publication year - 2003
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/1467-8276.00496
Subject(s) - production (economics) , beef cattle , revenue , agricultural economics , economics , feeder cattle , agricultural science , business , zoology , environmental science , microeconomics , biology , accounting
A systems model was estimated to determine the effects of declining U.S. retail beef demand on farm‐level beef prices and production. Retail beef demand declined by nearly 66% from 1976 to 1999. Results indicate autonomous shifts in retail demand significantly impacted farm‐level demands and production. Based on equilibrium multipliers, the 1976–99 reduction in beef demand decreased real slaughter cattle prices and production by 32.1% and 11.2%, respectively. Real feeder cattle prices and production decreased by 8.0% and 22.6%, respectively. Combining the decreases in farm prices and production, slaughter and feeder cattle producers experienced a real revenue reduction of $13.3 billion (61%) due to the long‐term decline in demand.