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Demand Analysis of the Markets for Soybean Oil and Soybean Meal
Author(s) -
Vandenborre Roger J.
Publication year - 1966
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 - 10.2307/1236622
Subject(s) - soybean meal , soybean oil , meal , food science , business , environmental science , chemistry , raw material , organic chemistry
A 10‐equation simultaneous model of the soybean economy was constructed. This involved relationships representing quantities demanded domestically as well as exported, for both soybean oil and soybean meal. Estimates of the structural parameters of the model were obtained by the two‐stage least‐squares procedure, using first differences of the data. The estimates indicate an annual necessary increase of more than 30 million bushels of beans to cover the needs of the United States, Western Europe, Japan, and Canada, if prices are to remain relatively constant. This amount is based on the assumption that human and animal populations increase and that shifts in tastes and preferences and in feeding technology in these regions are of the same magnitude as they were during the period 1949–1964. Also it was assumed that the production of competing oils and oilseeds at the same prices as in the last decade would not drastically change. The domestic demand for oil and meal is price‐inelastic (—.45, —.28); this statement holds for exports also (—.90, —.58). However, the price elasticities of demand for meal are less reliable than those of demand for oil.