Supply response on the Hungarian pork meat sector

Despite of the increasing production and consumption of white meats, pig breeding is still one of the most important animal husbandry sectors Worldwide and in the European Union as well. In Hungary over the past decades, the pig sector has undergone significant changes. The livestock has sharply decreased from more than 8.5 million in 1989 to 3.3 million in present. After the post 1989 increase of herd size bred in family farms, their share diminished, at present two-thirds of output is produced by corporate farms. It appears that small scale farming has major difficulties, they must consider all cost reducing alternatives to improve their competitiveness. With pressure on purchase prices from the downstream market levels, and considering that fodder represents about 50-60% within total production costs, in this paper we analyse the influence of these two factors upon pig breeding farmers' supply response. We employ Vector Error Correction Model specification, following the theoretical model of Hallam and Zanoli, 1993. Estimated long-run elasticities highlight farmers' reliance on live pigs for slaughter purchase price and soya fodder price. --error correction model,supply response,pork sector,Hungary

Monetary impacts and overshooting of agricultural prices in a transition economy

This research focused on the time adjustment paths of the exchange rate and prices in response to unanticipated monetary shocks. Johansen’s cointegration test along with a vector error correction model was employed, to investigate whether agricultural prices overshoot in a transition economy. The empirical results indicate that agricultural prices adjust faster than industrial prices to innovations in the money supply, affecting relative prices in the short run, but strict long-run money neutrality does not hold

Mezőgazdasági árak = Agricultural Prices

Jelen kutatás azt vizsgálja, megfigyelhető-e a piaci erő alkalmazása a magyar sertéshús szektorban. A kutatás hiánypótló, mivel ellentétben az eddigi kutatásokkal, ahol jellemzően általános és nem-teljes ártranszmissziós modelleket becsültek, jelen kutatásban egy strukturális piaci modellt vezetünk le, majd becsülünk meg. Az elemzést, a termék vertikum első lépcsőjén, a vágásra szánt élő sertések keresletének és kínálatának szintjén végeztük. A kutatás legfontosabb eredménye, hogy ezen a szinten nem mutatható ki a piaci erő alkalmazása. Ezt az első látásra meglepő eredményt a magyar sertés tenyésztés, vágás és feldolgozás strukturális tulajdonságainak az elméleti vizsgálata is megerősítette. Megjegyzendő, hogy a sertésvertikumnak csupán az első szintjét elemeztük. Annak ellenére, hogy ezen a szinten nem mutattuk ki, a piaci erő jelen lehet a további piaci szinteken. A szupermarket láncok növekvő fontossága és piaci részesedése, valamint a kiskereskedelemben megnyílvánuló gyors koncentrációs folyamat a piaci erő kiskereskedelemben való jelenlétére utalhat. | This study investigates the existence of market power in the Hungarian pork chain. Doing this, it contributes to filling a gap in the literature. Contrary to many other studies, not an incomplete price transmission model but a structural market model is derived and estimated. The analysis is restricted to the demand and supply of pigs and thus the first stage of the Pork chain. The hypothesis of market power had to be rejected. The lack of market power result is also emphasised by the theoretical inspection and description of the structural characteristics of pork production, slaughtering and processing. Furthermore, only a small part of the total chain was analyzed. The lack of evidence on market power in the first stage, does not imply that market power is absent in downstream sectors as well. The growing importance of supermarket chains, and the rapid concentration processes in retailing suggest that market power might be present in retailing

Parametric farm performance and efficiency methodology: Stochastic Frontier Analysis

There is a continuously growing literature on the agricultural transformation in Central and Eastern European countries (see some surveys in Brooks and Nash 2002; Rozelle and Swinnen 2004). The research has focused on various aspects of transition, including land reform, farm restructuring, price and trade liberalisation, but even though Farm Accountancy Data Network (FADN) data are now available for some years, there are only a few studies (e.g. Bakucs et al. 2010, Fogarasi and Latruffe, 2007, Baráth et al., 2009) focusing on Hungarian farm performance. The objective of this paper is to shed light on some methodological issues that are needed to study Hungarian farm performance. Here we consider one aspect of farm performance, namely technical efficiency. This measure refers to whether farmers are capable of using existing technology to its full potential by producing the most possible from a given set of production factor quantities

Empirical tests of sale theories : Hungarian milk prices

The paper tests various predictions of the sale theory literature, using the retailer specific price data in Hungary. Besides being set in a New Member State, characterised by rather different history of retailing than the established market economies, one of the main innovations of this paper is the comparative assessment of price promotions of two homogenous, every-day products different only with respect to their perishability: one litre boxed and one litre durable fluid milk. Using a battery of empirical techniques from the simple summary statistics, the distribution analysis to the discrete choice models and the co-integration, there is concluded that competing theory predictions on price distributions are not accepted. Also the Hypothesis that manufacturers determine timing of sales is rejected. The results do not confirm that durable goods should have a qualitatively different pricing pattern than perishable products. When the temporal order of sales is considered, the estimations support the Hypothesis of alternate sales. In sum, the predictions of the existing retail sales models only partly confirm certain empirical aspects of price promotions

Élelmiszerár volatilitás az új tagországokban

Több évtizedes relatív stagnálás után 2008 - ban és 2011 - ben a mezőgazdasági alapanyagok és élelmiszerek árai hirtelen az égbe szöktek, megnövelve a tudományos igényt a mezőgaz dasági árak volatilitásának elemzésére és visszahozva a témát a magas szintű politikai kérdé sek körébe. A cikk az élelmiszerárak volatilitását vizsgálja a 2004 - ben és 2007 - ben az Európai Unióhoz csatlakozott tagországok példáján, havi Eurostat adatok alapján, leíró statisztikákkal, majd a változások okait igyekszik feltárni. Eredményeink szerint az új tagországokban 2005 - höz képest folyamatosan nőttek az élelmiszerárak, noha a relatív szórás értékei jól azonosítják a 2008 - as és 2011 - es kiugró értékeket. A relatív szórás értékek és a 10%- os ársáv eredmények alapján az új tagországok alapvetően két csoportra bonthatók: magas és alacsony élelmiszerár volatilitással rendelkező országokra. A változások alap vetően nemzetközi tendenciát eredményei, ám a cikk azonosít néhány regionális sajátosságot is

Contractual relationships in the Hungarian milk sector

In this paper we present an empirical analysis of farmers' contracting choice in the Hungarian milk sector using 2005 milk producer survey data, employing transaction cost economics. We focus on analysing some key determinants of farmers' contracting choices: type of contracts, duration, number of contractors, incentives provided in the contract and business history of farmers and buyers. Some of the main results include the importance and effect of farm size, quantity of milk delivered, planned short and long run or contract related investment on farm, the possibility of farmer to influence prices on the contracting choices. --transaction costs,contracts,milk products,Hungary