CHANGING PRICES, CHANGING CIGARETTE CONSUMPTION

Consumer/Household Economics, Demand and Price Analysis,

MORALE AND FACULTY DEVELOPMENT IN AGRICULTURAL ECONOMICS

Morale and faculty development are closely related. The agricultural economics profession must decide what it is about. There is room to practice the principle of comparative advantage and allow a degree of specialization in teaching, extension, and research. To continue in the role of an applied discipline, there must also be an opportunity for the young professional to establish rapport with, and understanding of, the private sector and the policy-making arena. If that is to happen, there must be encouragement in the institutional setting and by faculty colleagues who respect the importance of investment in building rapport and in establishing credibility. If that environment is present, morale should be good and faculty development will occur.Morale, Faculty development, Comparative advantage, Research, Extension, Teaching, Balance, Teaching/Communication/Extension/Profession,

PRICE DISCOVERY CHALLENGES IN THE LIVESTOCK INDUSTRY

Includes speech and PowerPoint Presentation.Livestock Production/Industries,

TAXATION: NO SIMPLE ANSWERS

Public Economics,

A QUANTITATIVE APPROACH TO THE FEEDLOT REPLACEMENT DECISION

Livestock Production/Industries,

A COMPARISON OF LIVEWEIGHT, CARCASS AND LEAN MEAT CRITERIA FOR THE FEEDLOT REPLACEMENT DECISION

Livestock Production/Industries,

IMPLEMENTATION OF ELECTRONIC MARKETING OF SLAUGHTER CATTLE IN VIRGINIA: REQUIREMENTS AND PROCEDURES

Research and Development/Tech Change/Emerging Technologies,

THE IMPACT OF SELECTED HEDGING STRATEGIES ON THE CASH FLOW POSITION OF CATTLE FEEDERS

Agricultural Finance,

COSTS OF OPERATING A COMPUTERIZED TRADING SYSTEM FOR SLAUGHTER LAMBS

Research and Development/Tech Change/Emerging Technologies,

Macro Influences on the Beef Business

There are many major economic focuses at work in the sector. In late 2003, a start to the herd building phase of the cattle cycle is imminent. Export markets are coming back after faltering during 2002, and beef demand, domestic and international, is growing again. We have not seen the combination of heifer holdback to build the herd, which will reduce per capita beef supplies, and increased demand for beef since the early 1970’s. Unless corn prices surge, and this is unlikely, calf prices will go above $1.00 and generally stay there for the next several years—perhaps as long as 5 to 6 years. As the supply-side cycle and resurgence in beef demand contribute their influences, the organizational structure of the marketplace continues to change. Quality grades in beef have been outdated for 25 years. Such important product attributes as tenderness have not been brought into the grades, and that policy failure has ensured that the price driven system could not be effective as a means of coordination and quality control. Our meat scientist colleagues were finding toughness problems in 20 to 25 percent of the Choice fresh cuts in the 1980’s, and little progress has been made in more recent years. Selling everything at one average price each week does not give the producer any reason to change genetics and management and marbling only explains about 30 percent of the variation in tenderness. That simply is not good enough. The first step the producer-initiated vertical alliances typically take is to guarantee tenderness which is testimony to the importance of this quality issue. It is hard to have the consistently positive eating experience all of us want to see with the beef consumer when the product failure rate in the form of “too touch to chew” is as high as 25 percent. The pricing mechanism could have provided the coordination and quality control, perhaps, if grades had been modernized and technology adopted to get to individual animal measurement and pricing. But that did not happen, and we moved to non-price means of coordination and quality control. When the industry moved to the controversial non-price means of quality control like vertical alliances and contracts, we saw a surge in the much needed investments in new quality-assured and consumer-friendly product lines by the large packers. I hope we don’t cut off those new investments by passing laws to block the trends away from the failed price-driven systems. If we like price-driven systems, and I do, then we need time and energy spent on modernizing the quality grades so the price-driven system would have a chance to work, but I predict that will not happen. About one-half of the cattle feeding sector is being paid more than their cattle are worth, and they will not join in any consensus effort to get the grades changed. Remember the debate surrounding taking the B-maturity cattle out of the Choice and Select grades? Recognizing, then, that producers will get caught up in forced change and controversy about policy and process, there is nonetheless a big opportunity in front of us. Let’s look at the important economic forces that will be at work in the coming years and look for the strategic moves that should be considered at the producer level