Bayesian Estimation of The Impacts of Food Safety Information on Household Demand for Meat and Poultry

Consumer reaction to changes in the amount of food safety information on beef, pork, and poultry available in the media is the focus of this study. Specifically, any differences in consumer reactions due to heterogeneous household characteristics are investigated. The data used in this study are monthly data from the Nielsen Homescan panel and cover the time period January 1998 to December 2005. These panel data contain information on household purchases of fresh meat and poultry as well as demographic characteristics of the participating households. The data used to describe food safety information were obtained from searches of newspapers using the Lexis-Nexis academic search engine. Consumer reactions are modeled in this study using a demand system that allows for both discrete and continuous choice situations. A seemingly unrelated regression (SUR) tobit model is estimated using a Gibbs sampler with data augmentation. A component error structure (random effects model) is incorporated into the SUR tobit model to account for unobserved heterogeneity of households making repeated purchases over time. Estimates of food safety elasticities calculated from the random effects SUR tobit model suggest that food safety information does not have a statistically or economically significant effect on household purchases of meat and poultry.food safety, panel data, Gibbs sampler, component error, Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,

An Operational Approach for Evaluating Investment Risk: An Application to the No-Till Transition

An Operational Approach for Evaluating Investment Risk: An Application to the No-Till Transition Abstract: Roy’s safety-first rule is used to provide measures popular with farmers of short and long term business risk associated with various no-till transition strategies over an investment horizon. The short run rule provided more sensitivity to inter-year financial risk than other commonly used criteria. Results revealed that speed of adoption influenced the probability of successful transition more than did the sequence of drill acquisition methods. Higher equity and larger farms had a greater chance of transition success. Slow acreage expansion with a custom or rental drill reduces risk until a no-till yield penalty is eliminated.food safety, discrete choice, information, consumer demand

The Impacts of Food Safety Information on Meat Demand: A Cross-Commodity Approach Using U.S. Household Data

The potential impacts of a food safety event on consumer demand for meat is of significant concern to producers, packers, processors, retail businesses, and the USDA. This study investigates whether publicized food safety information from the printed media on beef, pork, and poultry, impacts the demand for these commodities. A four commodity complete demand system is employed using monthly household level data on meat purchases collected by the Nielsen Company, with separate food safety indices incorporated for beef, pork, and poultry. Results from the analysis indicate that consumers purchase relatively high levels of pre-committed quantities of pork, chicken, and turkey, while beef consumption appears to be primarily from supernumerary expenditures. The results also indicate that seasonal demand patterns are statistically significant in explaining the quantity of meat and poultry demanded. However, the food safety variables are not jointly statistically significant from zero.Demand and Price Analysis, Food Consumption/Nutrition/Food Safety,

INCORPORATING CURRENT INFORMATION INTO HISTORICAL-AVERAGE-BASED FORECASTS TO IMPROVE CROP PRICE BASIS FORECASTS

Being able to accurately predict basis is critical for making marketing and management decisions. Basis forecasts can be used along with futures prices to provide cash price projections. Additionally, basis forecasts are needed to evaluate hedging opportunities. Many studies have examined factors affecting basis but few have explicitly examined the ability to forecast basis. Studies have shown basis forecasts based on simple historical averages compare favorably with more complex forecasting models. However, these studies typically have considered only a 3-year historical average for forecasting basis. This research compares practical methods of forecasting basis for wheat, soybeans, corn, and milo (grain sorghum) in Kansas. Across most of the multiple-year forecast methods considered, absolute basis forecast errors were slightly higher for the harvest forecasts than the post-harvest forecasts. Using an historical 3-year average to forecast basis for wheat and soybeans was optimal as compared to other multiple-year forecasts. For corn and milo, a 2-year average was the optimal multiple-year forecast method. Incorporating current market information, such as current nearby basis deviation from an historical average, into a harvest basis forecast improves accuracy for only the 4 weeks ahead of harvest vantage point, but improves the accuracy of post-harvest basis forecasts (24 weeks after harvest) from nearly all vantage points considered.Marketing,

Forecasting Crop Basis Using Historical Averages Supplemented with Current Market Information

This research compares practical methods of forecasting basis, using current market information for wheat, soybeans, corn, and milo (grain sorghum) in Kansas. Though generally not statistically superior, an historical one-year average was optimal for corn, milo, and soybean harvest and post-harvest basis forecasts. A one-year average was also best for wheat post-harvest basis forecasts, whereas a five-year average was the best method for forecasting wheat harvest basis. Incorporating current market information, defined as basis deviation from historical average, improved the accuracy of post-harvest basis forecasts. A naive forecast incorporating current information was often the most accurate for post-harvest basis forecasts.basis forecast, crop basis, current information, naive forecast, Marketing,

Global and U.S. Wheat Gluten Industries: Structure, Competition, and Trade

Industrial Organization,

An Overview of the Wheat Gluten Industry

Production Economics,

Probabilistic Models of Yield, Price, and Revenue Risks for Fed Cattle Production

Livestock Production/Industries,

Structural change in forward contracting costs for Kansas wheat

Farmers use forward contracts to eliminate adverse price and basis movements prior to harvest. Since late 2007, the local basis for Kansas wheat has changed dramatically relative to historic levels, causing greater risk exposure for elevators o ffering forward contracts. The result has been an increase in the cost of forward contracting paid by farmers from $0.086 per bushel to$0.327 per bushel. The factors driving this increase in costs are basis volatility, wheat futures harvest price, the information available in the market as harvest approaches, and realized returns to the elevator from forward contracting in previous years

Land Market Valuation of Groundwater

We estimate irrigation premiums and implicit marginal valuations of water in-storage using parcel-level transaction data for land sales in the Kansas portion of the High Plains Aquifer. We find that agricultural land values are 53% higher for irrigated parcels than non-irrigated parcels on average and that the irrigation premium has increased at an average rate of 1.0 percentage points per year over the sample period (1988–2015). Spatial heterogeneity in irrigation premiums is explained by differences in saturated thickness of the aquifer. Water in-storage is capitalized into land prices at average marginal values ranging from $3.42/acre-ft to$15.86/acre-ft