The Impact of Coordination of Production and Marketing Strategies on Price Behavior: Evidence from the Idaho Potato Industry

High potato price volatility, decreasing demand for fresh potatoes and prices below the cost of production led to a decision of a number of Idaho potato growers to organize the United Fresh Potato Growers of Idaho, a marketing cooperative. The programs and strategies of the cooperative target both the production and marketing of fresh potatoes in Idaho. To evaluate the effectiveness of the programs implemented by the cooperative, we examine the level and volatility of fresh potato prices during two periods: before the cooperative was organized and when the cooperative is in the market. We find empirical evidence suggesting that fresh potato prices were higher and less volatile during the period when the cooperative was in the market.agricultural markets, cooperative, price volatility, potato industry, Agricultural and Food Policy, Crop Production/Industries, Demand and Price Analysis, Marketing, Q10, Q11, Q13,

DETERMINANTS OF TRUST IN THE INDONESIAN POTATO INDUSTRY: A COMPARISON AMONG GROUPS OF POTATO FARMERS

Indonesia’s potato industry is undergoing a rapid transformation, presenting producers with new and profitable opportunities to participate in sales to the modern channels. However, few farmers are involved in the new channels. This study offers an analysis of three groups of potato farmers’ perceptions of trust in their buyers. The aim is to understand the many different ways producers can enter modern chains and how different channels suit the individual characteristics of different producers. We surveyed 50 farmer field schools (FFS) producers, 60 Indofood suppliers, and 192 general potato farmers (GPF) in the largest potato producing area in Indonesia, West Java. Using MANOVA and linear regression methods, the study reveals that flexibility and dependence are determinate factors of trust in the three groups. Particularly among the FFS producers, relative price and firm size are factors identified to increase the farmers’ trust. Farmers contracting with Indofood establish the relationship with the firm in terms of reputation and flexibility. On the other hand, the GPF has more concerns about buyers offering price transparency and joint problem solving. This article provides a conceptual model and an empirical analysis of the buyer-seller relationship in the potato industry in Indonesia.buyer-seller relationships, trust, potato industry, Crop Production/Industries,

Cointegration and Market Integration: An Application to the Potato Markets in Rural West Bengal, India

The paper attempts to examine the market integration with the help of cointegration test on the prices of potato of Hooghly district in West Bengal. The analysis has been made at two levels, namely at the level of wholesale markets and at the retail markets. The cointegration test by Johansen and Jeselius (1990) applied to weekly prices of three important potato markets in Hooghly district suggest that the markets are integrated. Our results revealed that price signals and information are transmitted smoothly across the markets. These results have important policy implications. In a situation when potato markets are spatially integrated the government may think of reducing or even withdrawing its efforts to influence the price in the market. The finding of the market integration appears to be quite significant for the success of price policy and market liberalisation programs undertaken in India.market integration, cointegration, wholesale potato market, retail potato market, price signal and information., Crop Production/Industries, Marketing, Q13,

Biases in calculating dumping Margins: The case of cyclical products

A dumping investigation involves comparing export prices with a “normal value” loosely defined as the price in the exporter’s domestic market observed in the course of normal trade. However, domestic sales with prices below production costs are excluded from the computation of a normal value; thus increasing the probability products with cyclical prices will get caught with positive dumping margins although there are no intentions to dump. The objective of the paper is to illustrate how price cycles impact the magnitude of estimated dumping margins. The empirical analysis focuses on Canadian hog exports to the U.S. and U.S. potato exports to Canada. The period and amplitude of each price cycles are estimated. The analysis starts with the assumption that export and domestic prices are equal so no true dumping occurs. Margins are then calculated based on rules that exclude below cost sales. The resulting average dumping margins for Canadian hogs and U.S. potato exports are respectively 11.5 and 5.9 percent. Biases in dumping margins depend on the nature of the cycle, the period of investigations, and the estimate of the cost of production.Anti-dumping; frequency estimation; price cycles; hog/pork trade disputes; potato antidumping case

CONSUMER POTATO DEMAND

Changes in consumer demographics, socioeconomic conditions, lifestyles, food tastes, and health and nutrition concerns have been associated with shifting food purchase patterns. This article focuses on potato purchase decisions and consumption, using a sample of Washington households. The results suggest that potato purchases are affected by factors such as product quality and price but not availability of point-of-purchase information. Reported changes in fresh and processed potato consumption appeared to be related to concerns with health and nutrition and demand for convenience. These findings have implications for the potato industry in developing new products and marketing strategies.Demand and Price Analysis,

Traceability and Demand Sensitiveness: Evidences from Italian Fresh Potatoes Consumption

When a traceability system takes place, either when mandatory or voluntary, many questions arise that need to be addressed and answered. One of the firsts concerns whether it introduces new costs with no gain in efficiency or, on the contrary, the system efficiency increases lowering costs and, as a consequence, market price of the good in hand. Among others, another issue that only rarely is addressed regards the effect of a price change on the final market. The objective of this paper was to simulate the effect on fresh Italian vegetables market of prices change due to a newer traceability procedure, focusing on early potato. Reasons why early potato was the main object of our study will be explained in detail later in the paper. Moreover, this study concerns a demand system estimation that has, as main goal, the measurement of own and cross price elasticities as well as expenditure elasticities. Such estimations are not strictly related with traceability because they measure any change in quantity demanded due to price changes due to any market perturbation. However, since early potato is experiencing a peculiar market and chain change in Italy, our simulation is meant to reason in terms of a “what if” approach, formally simulating the effect of any change in price due to an hypothesis of traceability system involved. In order to estimate a demand system, real household consumption data (3,000 observations) of a statistically representative sample of the Italian population of households was taken into account. Relevant measures of market variables were estimated by means of a Linear Almost Ideal Demand System implementing a large set of fresh vegetables: potato split in early and late, cabbage, salad, mushrooms, fruits vegetables, roots, asparagus, onion, tomatoes, peppers, cucumbers, beans, zucchinis and others.traceability, early potato, censored demand system estimation, sample selection approach., Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Research Methods/ Statistical Methods,

DEMAND ESTIMATION FOR AGRICULTURAL PROCESSING CO-PRODUCTS

Co-products of processing agricultural commodities are often marketed through private transaction rather than through public markets or those in which public transaction information is recorded or available. The resulting lack of historical price information prohibits the use of positive time series techniques to estimate demand. Demand estimates for co-products are of value to both livestock producers, who obtain them for use in livestock rations, and processors, who must sell or otherwise dispose of them. Linear programming has long been used, first by researchers and later as a mainstream tool for nutritionists and producers, to formulate least-cost livestock rations. Here it is used as a normative technique to estimate step function demand schedules for co-products by individual livestock classes within a crop-reporting district. Regression is then used to smooth step function demand schedules by fitting demand data to generalized Leontief cost functions. Seemingly unrelated regression is used to estimate factor demand first adjusted for data censoring using probit analysis. Demand by individual livestock classes is aggregated over the number of livestock within a region. Quantities demanded by beef cows for each of the three co-products considered, sugarbeet pulp, wheat middlings, and potato waste, are large relative to other species because of their predominance in the district. At the current price for sugarbeet pulp, quantity demanded by district livestock is low. However quantity demanded is price elastic and becomes much greater at lower prices. Wheat middlings can be an important component of livestock rations, even at higher prices. At a price slightly below the current price, local livestock demand would exhaust the wheat middlings produced at the district's only wheat processing plant. Potato waste is most appropriate for ruminant diets because these animals are able to consume a large quantity of this high moisture feedstuff. Potato waste can be a cost-effective component in beef and dairy rations. Practically, livestock markets for potato waste must be in close proximity to a potato processing plant. Its high moisture content limits the distance it can be economically transported. At current prices, potato waste can be economically included in the ration for beef cows on a farm nearly 100 miles from the processing plant, although storage challenges may restrict use of the feed to closer operations.co-products, demand estimation, econometrics, linear programming, Agribusiness,

Supply response of potato in Bangladesh: a vector correction approach

An attempt has been made in this study to examine the supply response of potato in Bangladesh by using the vector error correction approach. The short-run price elasticity was 0.45 while the long run elasticity was 0.62. Price policies are effective in obtaining the desired level of output for potato. If intervention in the market is of necessity, then it must be implemented during the harvest season for altering price expectations. Also emphases should be given to increase potato export and establishing export oriented potato processing industries

Disease Outbreaks and Agricultural Trade: The Case of Potatoes

This study analyzed the impact of PVYn and potato wart disease outbreaks in PEI on the potato industry. These disease outbreaks resulted in the loss of the US seed export market to PEI producers. The effects of the disease outbreaks were mitigated through value-added processing. Price premiums for processed potatoes allowed PEI potato producers to abandon seed exports without incurring losses. Evidence is presented to suggest that other countries have also used this approach when export restrictions were placed on domestic agricultural industries. Policy response to the two disease outbreaks include: i) development of a zones policy that helped to reopen markets into the US; and ii) financial compensation to producers above the minimum levels required under the Seeds Act and Regulations. Implementation of the zones policy had beneficial impacts on the potato industry and is mirrored in other disease outbreaks. In contrast, compensation above minimum requirements may set a costly precedent for future disease outbreaks and may have caused moral hazard problems.disease, trade, potatoes, Canada, food, safety, Agricultural and Food Policy, International Development, International Relations/Trade,