104 research outputs found

    Implications of the Multilateral Trade Agreement for Canadian Agriculture: A Computable General Equilibrium Evaluation

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    This study evaluates the impacts of the Uruguay Round Agreement (URA) on Canadian agriculture in a single-country general equilibrium framework. For this purpose a computable general equilibrium model of the Canadian economy that involves six agricultural and two non-agricultural sectors was constructed and calibrated on 1991 data. To assess whether Canadian agriculture benefits from the URA, two sets of anticipated changes in world prices, taken from studies of the global effects of the URA, were introduced into the model exogenously. The simulation experiments show that the minimum increases in world prices from global studies are too small to offset the negative effects on agriculture of the reductions in tariffs, export subsidies and domestic support. However, if world prices were to change by the maximum level of global projections, Canadian agricultural producers gain from the URA. The sectors that benefit the most are wheat, other grains, and processed foods, for which production and exports increase appreciably. Imports of milk and poultry products increase substantially and livestock sector imports also increase. Labour and capital demand increase in agriculture, particularly in the wheat and other grains sectors. The highest increase in factor returns in agriculture is for agricultural land. Since the export prices applied above are exogenously determined, a third experiment is conducted to determine the extent of the world price changes for agricultural exports that would offset the negative effects on sectoral domestic production of the URA policy commitments. This would require world prices that are about eleven per cent higher than in the base period for wheat and about ten per cent higher for other grains. The greatest increase in prices--by nearly thirteen per cent--would be required for the milk and poultry sector. More modest changes in world prices for the other agricultural sectors are needed to offset the impacts of the reductions in sectoral support necessitated by the URA. Most of these price changes lie within the ranges of world price projections from studies of the global effects of the URA.International Relations/Trade,

    Canadian Consumers' Preferences for Food Safety and Agricultural Environment Safety

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    This project applies statistical models to analyse the relative importance ratings for selected food risk issues given in January 2003 by a representative cross-Canada sample of consumers. Ratings for environmental risks that may be associated with agriculture are also assessed. Results of ordered probit econometric models that analyze the influence of respondent's socio-economic and demographic characteristics on food and environmental risk ratings indicate that these are influenced by gender, age, income, employment and location of residence. Males tended to choose lower risk ratings; residents of Quebec tended to give higher risk ratings to most of the queried food and environmental safety issues. The results suggest that measures of trust in institutions associated with the regulation and marketing of food also influence individuals' risk assessments associated with food and agriculture.food safety, environmental risks, risk perceptions, quantitative assessment, Food Consumption/Nutrition/Food Safety, C12, D12, I19, Q18,

    Model Choice and Structural Specification for Canadian Meat Consumption

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    Food Consumption/Nutrition/Food Safety,

    Canadian Dairy Demand

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    The Canadian dairy industry faces a changing market environment as processors react to apparent shifts in consumers' preferences, consumers react to an altered mix of products on retail dairy shelves, and industry adjusts to potential pressures of competition and the challenge of new market opportunities under the impetus of changes arising from international trade. The purpose of this study is to derive a set of updated and disaggregated estimates of demand for major dairy products in a manner consistent with the economic theory of consumer behaviour. These estimates are necessary for policy models, policy analysis and forecasting. Previously dairy demand estimates were only available for broad product groupings such as fluid milk, butter, all cheese and "all other dairy products". For this study, four weakly separable groupings of major dairy products and related foods are specified. These are milk and other beverages, fats and oils, dairy dessert and related products and cheeses and apparent substitutes. Skim milk powder is assessed not to be a member of any of these groups but is hypothesized to be a member of a fifth dairy subgroup of dairy protein products. Due to data limitations, it was necessary to follow a single-equation approach for this product. The appropriateness of each product grouping was assessed by a two-stage test. First, each subgroup was tested using non-parametric tests of the axioms of revealed preference, as a means of inferring whether or not choices within each subgrouping are consistent with constrained utility maximization. Second, parametric assessment of each subgroup gave further evidence regarding the appropriateness of the groupings in terms of whether the estimated demand parameters are relatively stable and plausible. Based on satisfactory performance in these tests, parametric analyses for each subgroup were conducted using the linearized version of the almost ideal demand system, incorporating appropriate seasonality and habit formation variables. Estimates of own-price, cross-price and expenditure elasticities of demand are derived and presented. In general these seem plausible. Signs on the own-price elasticity estimates are as expected; the magnitudes appear to be reasonable. As expected, the majority of the specified foods are price-inelastic. However, butter, cooking/salad oil and other cheese appear to be price-elastic. Yogurt, concentrated milk and ice cream are fairly expenditure elastic while the two cheese types and butter appear slightly expenditure elastic.Demand and Price Analysis,

    Investigating Changes in Canadian Consumers' Food Safety Concerns, 2003 and 2005

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    Building on the results of an initial analysis of risk ranking data collected from a representative group of some 850 Canadian respondents in early 2003, this study assesses a similar set of risk ranking questions applied to a somewhat larger representative group of some 1500 Canadians in late 2005. We also compare the 2003 and 2005 risk rankings. In both surveys, risk rankings for eight food safety issues (bacteria contamination, pesticide residuals, use of hormones in food production, use of antibiotics in food production, BSE (mad cow disease), food additives, use of genetic modification/engineering in food production, fat and cholesterol in food) and six environmental safety issues (water pollution by chemical run-offs from agriculture, soil erosion, GM, herbicide/pesticide resistance, adverse effects of agriculture on biodiversity, genetic modification/engineering, and agricultural waste disposal) were queried. These were ranked by respondents from 1(high risk) to 4(almost no risk) and 5(don't know). The order of questions was randomized across respondents. Attitudinal and demographic information were also collected in each survey. Respondents' risk perceptions did change appreciably for some of the food safety issues in 2005, compared with 2003; there were less changes for environmental safety issues. Pesticide residuals were rated as less of a "high risk" issue in 2005 than in 2003, while the use of food additives was indicated as "high risk" by more respondents in 2005 than in 2003. Econometric analysis based on ordered probit models suggests that women, older respondents and residents of Quebec were still the populations tending to give high-risk ratings in 2005. Comparing the data sets from the two periods suggests that a structural break occurred in several of the risk rankings over the two periods as some subgroups of respondents changed attitudes between 2003 and 2005. For example, men and those with university degrees tended to view pesticide residuals to be more risky in 2005 than in 2003, while those with higher incomes and those living in Quebec were less likely to rate pesticide residuals to be highly risky in 2005 than in 2003. The use of GM/GE as a food safety risk was rated higher in 2005 than in 2003attitudes to this technology may be hardening. However, BSE was rated lower as a high risk food safety issue in 2005 than in 2003, suggesting that more information and/or effective risk communication may have accompanied the three Canadian BSE incidents that occurred during the time period between the two periods.food safety risks, risk perceptions, environmental risk, Canadian agriculture, ordered probit models, Food Consumption/Nutrition/Food Safety, C25, D12, I 19, Q 18,


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    Public concern regarding food safety has emerged as a major policy issue. Chemicals and biotechnological processes are perceived as risks of food safety despite their contribution to an efficient, low cost agriculture and food industry. Increases in uses of biotechnological processes for foods are expected to be a major potential source of productivity improvements for Alberta and Canadian agriculture in future years. However, the demand for food safety involves increasing awareness and concern by consumers of chemical inputs and biotechnological processes in the agriculture and food industries. Nonetheless, there is a lack of basic economic and agricultural economic theory and methodology to analyze these issues and a need for policy, socioeconomics and marketing research on biotechnology and other environmental risk situations in the agricultural and food industry. This project was directed at developing and applying economic theory and methodology to help fill this gap. A major contribution of the project is the identification and verification of methodologies of stated choice to analyse tradeoffs arising from food safety perceptions of concerns by consumers. One component of the research project involved assessment of Alberta consumers' stated preferences and purchase behaviour for foods exhibiting a range of environmental risks, including perceptions of pesticide residues and hormonal treatments derived from biotechnological processes. The results of this survey indicated that Albertans were more concerned about pesticide use in food production than about the use of hormones. In contingent valuation questions developed for the study, more Albertans wish to restrict pesticide use (relative to a base case of not restricting either hormones or pesticides). They tended to persist in these choices in the face of potential increases in food costs, reflecting a higher level of concern with pesticides than hormones. Increasing education increased this concern. Increasing food cost decreased the probability of choosing to restrict pesticide or hormone use. Women appeared to perceive pesticide use in food production as a greater food safety risk than was perceived by men. The inferred average willingness to pay to restrict pesticide and growth hormone use in food production amounted to about 25% and 13% respectively of the average Albertan's food expenditures respectively. In the second survey of consumers' food/environmental risk perceptions undertaken relative to this project, the responses of a random sample of consumers to the use of recombinant bovine somatotrophin (rBST) in milk production were elicited using a stated preference methodology. A conditional logit model of consumer choice was developed and tested to analyse consumers' choices of milk with varying characteristics of fat content, price, freshness and rBST treatment. Awareness of rBST presence or otherwise is implied by labelling. The approach attempts to simulate market conditions with and without rBST labelled milk and to predict consumers' responses to variations in these conditions. Welfare calculations for a representative consumer indicate welfare losses with the introduction of rBST. These were slightly less for a male than a female household food purchaser and were less for food purchasers with higher levels of income and education. There was a small welfare gain when the representative food purchaser was offered a full range of "rBST" and "non-rBST" milks. The results suggest that making appropriately labelled "rBST-free" milk available to consumers could decrease consumer welfare losses associated with any introduction of rBST. The outcomes from application of these methodologies were related to the evidence of consumers' purchasing behaviour after licensing of the technology of rBST for use in the United States; this introduction did not require labelling. The assessment suggests a critical impact of product labelling policies and strategies on potential market impacts. An assessment is also made of Canada's food safety regulatory framework. The need for increased transparency and greater public participation in regulatory processes as means to increase public confidence in such food safety regulatory processes, specifically relating to biotechnology, is also identified.Food Consumption/Nutrition/Food Safety,


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    The ethnic Asian market in Washington and Oregon constitutes a sizable niche market for fresh Canadian pork. Since California possesses a large population segment that originates from Asia, the characteristics of the ethnic Asian-origin market in the northern part of that State are also of interest since this may also be a potential niche market for Canadian pork. The objectives of the first part of this study are to evaluate the Asian ethnic markets for fresh pork in the United States Pacific Northwest and Vancouver. In the second part of the project the assessment of the market for fresh pork by Asian-origin consumers was extended to San Francisco. In this extension, a detailed assessment was also made of the product preferences for fresh pork by Asian-origin consumers in San Francisco and the behaviour patterns associated with store choices of these fresh pork consumers. Asian retailers and distributors in Vancouver, Seattle and Portland were surveyed by direct interview during November and December 1996. The survey applied semantic differential scaling questions, open-ended questions and a stated preference task, a conjoint methodology, to examine pork retailer's and distributor's perceptions of fresh pork produced in Western Canada and in the Midwest United States. Personal interviews with wholesalers and retailers were also applied in the San Francisco market survey which was conducted in 1998. Two consumer surveys were also conducted in San Francisco in 1998, directed at Asian-origin consumers of fresh pork. The structure of the market for fresh pork represented by retailers catering to Asian consumers in Vancouver differs from that in Seattle and Portland. The "Asian market" in Vancouver is dominated by many small shops that deal directly with packers. The small shops in Seattle and Portland deal with distributors and wholesalers. Distributors play a small role in Vancouver's retail market. Asian retailers in Seattle deal with a variety of suppliers, including both packers and distributors. In Portland, retailers catering to Asian consumers trade mainly with distributors and a local packer-wholesaler. In San Francisco, Asian stores and butcher shops prefer to obtain pork through smaller joggers, while American style supermarket retailers catering to the Asian consumers purchase pork directly from meat packing companies; fresh pork is sold in different ways in the different types of stores catering to Asian consumers that are found in these markets. The first survey found that Western Canadian pork enjoys an image of superior quality amongst retailers and distributors in Seattle's ethnic Asian market. Asian retailers in Portland are less familiar with Western Canadian pork and did not regard it as highly as did retailers in Seattle. However, distributors in Portland are more familiar with Western Canadian pork and consider it to be superior to Midwest United States pork in terms of overall quality, meat colour and fat trim. In both these markets, Western Canadian pork is generally considered to be expensive. These results are not statistically significant, however they are of economic relevance since most of the major players in the segment were interviewed. Little knowledge of Western Canadian pork was evidenced by retailers or consumers in this market segment in San Francisco. Western Canadian pork presently enjoys a reputation for superior quality amongst the retailers that specialize in sales to Asian consumers in Seattle and Portland. However it is also clear that many members of the trade lack information or experience with Canadian pork. Consequently, there is an opportunity for Canadian processors to maintain or increase market share through more education and promotion to this market segment. The 1998 survey of Asian-origin consumers of fresh pork in San Francisco focused on two aspects: preferences for fresh pork attributes and choice of store for fresh pork purchases. An intercept survey method was chosen to select and interview consumer respondents. Some 40% of the 196 respondents to the store choice survey purchase most of their fresh pork from American style supermarkets, 33% purchase mostly from small Asian stores, 24% from large Asian stores, and the rest from butcher shops. The most popular cut of pork purchased by Asian consumers is loins, followed by pork shoulders and butts, then pork leg, bellies, hock, and offal. The analysis indicated that socio-economic and demographic factors, as well as store attributes, significantly affect Asian consumers' store and product choices. The analysis of the ranking of selected attributes of fresh pork by Asian-origin consumers in San Francisco, California showed that freshness is ranked as the most important attribute, followed by the attributes of the color of meat, lowness in fat, and the whiteness of fat. The attributes of price, freedom from chemicals, and being USDA labelled were also ranked to be of importance. The attributes of little or least importance were knowing that pork came from the US, customized pork cuts, the variety of pork cuts, packaged pork, vacuum packed pork and seasoned and prepared pork. Empirical results from an ordered probit model postulated to explain respondents' rankings of attributes indicate that particular demographic and socio-economic characteristics of Asian-origin consumers influenced the importance rankings for the pork attributes that were identified to be important. For example, Chinese origin consumers were appreciably more sensitive to pork price than were other Asian-origin groups. One facet of the findings is that marketing strategies should not treat Asian-origin consumers as a single homogenous niche group in marketing since there are identifiable sub-groups of these consumers with specific attitudes and preferences. The importance placed on different attributes by particular ethnic subgroups, and their different preferences for stores at which fresh pork is purchased, provides useful information on which to develop strategies to target market development activities at the Asian-origin ethnic subgroups.Marketing, International Relations/Trade,


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    Consumers' attitudes to genetically modified (GM) food ingredients and their reactions to and preferences for labeling of GM food are topical issues for Canadian food policy and are the subjects of this study. This project included several components. The first of these was an assessment of public attitudes to biotechnology and to GM food based on evidence from polls and other studies. These show increasing awareness and some increase in wariness of GM food, in Canada and elsewhere. In the second component of the project, analysis of survey data on Alberta consumers' preferences for different policy approaches to GM food was undertaken. This analysis indicates a preference by Alberta residents for GM food policy to emphasize the provision of more information to consumers, through labeling, over a policy that would provide for more rigorous inspection; even so, more inspection was favored by many respondents. More regulation that would restrict biotechnology was the least favoured of the three options that were presented to Alberta respondents. In a third component of the project, a case study on individual's attitudes to and preferences for GM ingredients in two selected food items (one of which was a nacho chip and the other of which was bread) was pursued through focus groups that were conducted in Edmonton, Alberta in 2002. This indicated highly varied attitudes and responses to GM food in general and to the selected products in particular. Attitudes to and preferences for environmental and health benefits that might be introduced through biotechnology were explored in these groups. Some 50 percent of focus group respondents indicated a willingness to buy the identified GM products, at a price discount. The fourth and final component of the project involved two sections of a Canada- wide survey, conducted in early 2003. These components queried respondents' assessments of the importance of various food safety risks and various environmental issues associated with food and agriculture, as well as attitudes to labelling policy. Overall, Canadians tended to see agricultural biotechnology as more of an environmental risk than a food risk and numbers of other food and environmental issues were seen to be more risky by many respondents. However the use of genetic modification/engineering in food production was seen as a very high risk issue by about one-fifth of respondents. Respondents also indicated a strong desire for public involvement in biotechnology policy, voted strongly for mandatory labeling and disagreed that labeling is not needed if the product's quality remains unchanged. An appreciable majority of respondents expressed a degree of skepticism concerning the use of voluntary labeling. The findings of this project have served as a basis for subsequent more extensive and detailed assessment of Canadian consumers' risk preferences and trade-offs in the context of specific product GM labelling policies.Demand and Price Analysis, Research and Development/Tech Change/Emerging Technologies,


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    Agricultural and Food Policy, International Relations/Trade,
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