RELATIONSHIP BETWEEN FED CATTLE MARKET SHARES AND PRICES PAID BY BEEFPACKERS IN LOCALIZED MARKETS

Abstract

Industrial organization theory hypothesizes that larger beefpackers can depress prices paid for cattle. Prices paid between at least two beefpackers in some localized markets studies were found to be significantly different for the one-month study period. However, larger beefpackers in each market paid neither lower or higher prices than the smallest buyer, with just one exception. No significant relationship was found between market shares of buyers and average prices paid for cattle. Thus, the hypothesis that larger beefpackers pay significantly lower prices was rejected.Livestock Production/Industries,