Pricing Efficiency in Hog Markets

Weekly hog prices for Edmonton, Toronto and an average of mid-west United States markets are analyzed for lead-lag structure or Granger Causal ity. These price series are analyzed over six time periods from January 1964 to December 1983, corresponding to changes in marketing structure by the Alberta Pork Producers Marketing Board. Both ARIMA filters and a restricted-unrestricted ordinary least squares test for Granger Causality are employed. Results indicate an increase in isolation of markets, possibly illustrating the effectiveness of the local marketing board in its efforts to relate prices to local supply and demand conditions.
Les prix hebdomadaires du pore à Edmonton, Toronto et d'une moyenne de marchés du mid-west ameYicain sont analysés pour evaluer les directions des mouvements de ces marchés les uns par rapport aux autres ou la causalité de Granger. Ces séries de prix de Janvier 1964 à décembre I983 sont divisées en six périodes qui correspondent aux changements structurels de la mise en marché effectués par la régie albertaine du pore. L'analyse utilise des filtres ARIMA et un simple modéle linéaire restreint ou non restreint pour faire l'épreuve de causalité de Granger. Les résultats indiquent une augmentation de I'isolation des marchés les uns les autres; il semble que la régie de mise en marché locale réussit à relier les prix aux conditions locales de l'offre et de la demande.     

The Effects of Various Policy Regimes in the Integration of North American Grain Markets

This paper examines the integration between U.S. and Canadian grain prices using cointegration and error correction approach. Price relationships are examined in four different subperiods: pre-NAFTA (January 1986 to December 1993), post-NAFTA (January 1994 to July 1999), pre-WGTA (January 1986 to July 1995) and post-WGTA (August 1995 to July 1999). A free trade agreement implemented in 1989 that later folded into NAFTA affected price integration in the North American grain market, but Canada's elimination of freight subsidies in 1995 strengthened it. Empirical results indicate that longterm relationships exist among the price series. Prices are found to be first-difference stationary and cointegrated during the four subperiods. However, cointegration analysis shows significant post-WGTA improvement in market integration, particularly in the speed at which the market adjusts to departures from its long-run equilibrium.     

尼日利亚不同地区反刍动物市场定价行为研究

本文对尼日利亚牛羊市场的空间价格一体化程度进行了检验，试图运用双变量自回归时间序列模型验证寡头垄断市场上牛羊价格的非竞争性定价行为。论文分别对牛羊市场的合谋、歧视性、价格领袖和竞争性定价行为进行了经验性检验。结论表明，在牛羊价格形成中，博尔诺（Borno）和索科托（Sokoto）州的牛羊价格领先于克里斯河（CrossRiver）、依莫（Imo）、卡诺（Kano）、拉各斯（Lagos）、尼日尔（Niger）和奥约（Oyo）州这些地方市场的价格。有关证据也支持共谋定价一般与市场的集中有关的判断。     

An Analysis of Dynamic Economic Relationships: An Application to the U.S. Hog Market

Recent advances in multiple time-series analysis are discussed and applied to data from the U.S. hog market. Vector-autoregressive and moving-average representations are derived and interpreted with respect to implied dynamic relationships among the variables.
Desprogrès récents dans l'analyse des séries temporelles multiples sont présentes el utilisés pour l'analyse des données sur le marché porcin aux Etats- Unis. Deux representations, la premiere vectorielle el autoregressive et la seconde moyennes mobiles, sont dérivées et interpretées selon les relations dynamiques implicites des variables.     

World Black Tea Markets: Relationships and Implications for the Global Tea Industry

Prices at world tea auctions are interlinked across different black tea markets. This study applied the cointegration approach using Engle-Granger 2-stage estimation procedures to examine the extent to which these markets are linked. We analyzed the relationships between monthly average tea auction price data from 7 selected markets from Africa and Asia and found out black teas markets are defined more from the type of manufacture. Black tea markets seem segmented between orthodox types of tea mainly exported by Sri Lanka and Cut-Tear-Curl type traded in Mombasa, Kenya. Cointegration results show that tea agribusiness firms can benefit by simultaneously adopting both modes of manufacture. The tea boards in the respective countries should promote diversification of products into other segments of the market while at the same time control quality of tea, which by default will curb oversupply.     

The Impact of the Proposed June 1987 Income Tax System on Saskatchewan Grain and Hog Operations

The changes to the federal income tax system proposed in June 1987 are analyzed for their impact on farm size and competitiveness of Saskatchewan grain and hog operations. Farm growth, income and income taxes paid are simulated over a 20-year period. The June 1987 proposed tax system is projected to be progressive in taxing grain operations when there is no land inflation and excess depreciation is recaptured, but is nearly neutral or slightly regressive when the Saskatchewan livestock tax credits are taken into account. Assuming no land inflation and recapture of excess depreciation, small grain operations pay less income tax than small livestock operations, medium-sized grain operations pay slightly more but large grain operations pay considerably more taxes than the corresponding hog operations. The elimination of the capital cost allowance recapture tends to increase the competitive advantage of the hog operation over the grain operation, but a modest 4% annual increase in land values coupled with capital gains exemptions increase dramatically the overall competitive advantage of the grain operation over the hog operation. Les modifications apportées au régime d'impôt sur le revenu proposé en juin 1987 sont analysées pour leurs répercussions sur la taille des exploitations et la compétitivité des céréaliculteurs et des éleveurs de pores de la Saskatchewan. On a simulé la croissance des exploitations, le revenu et les impôts sur le revenu payés au cours d'une période de 20 ans. Le régime fiscal proposé de juin 1987 se veut progressif dans l'imposition des fermes céréalières lorsqu'il n'y a pas d'inflation du prix des terres et que l'amortissement excédentaire est récupéré, mais est pratiquement sans incidence sur les fermes ou légerement régressif à cause des crédits d'impôt consentis sur le bétail de la province. En sup-posant l'absence d'inflation du prix des terres et la récupération de l'amortissement excédentaire, les petits producteurs de céréales paient moins d'impôt sur le revenu que les petits éleveurs de bétail, les producteurs moyens en patient légèrement plus, mais les gros producteurs paient beaucoup plus d'impôt que les éleveurs correspondants de pores. L'élimina-tion de la déduction pour amortissement a tendance à accroître l'avantage concurrentiel des éleveurs par rapport aux producteurs, mais un modeste 4% d'augmentation annuelle de la valeur des terres, conjugué à des exonérations pour gains en capital, augmente de facon dramatique l'avantage concurrentiel global dont jouit le producteur par rapport à l'éleveur de pores.     

The Impact of the Berlin Accord and European Enlargement on Dairy Markets

Journal paper No. J-18684 of the Iowa Agriculture and Home Economics Experiment Station, Ames, Iowa, Project No. 3566, and supported by Hatch Act and State of Iowa funds. Using a world agricultural model, we analyze the impact on dairy markets of the Berlin Accord on the European Union (EU) Common Agricultural Policy (CAP) Reforms. We also investigate the consequences of enlargement of the EU to include the Czech Republic, Hungary and Poland for the same markets. We produce a market outlook up to 2010 for these two scenarios. The Berlin Accord induces lower EU milk and dairy prices. A change in relative prices between cheese and butter-skim milk powder (SMP) occurs after 2005 and induces an expansion of cheese production, consumption and exports at the expense of the butter–SMP sector. Accession of the three central and eastern European countries (CEECs) leads to a permanent but moderate decrease in EU prices of milk and dairy products. For the three acceding CEECs, domestic prices increase dramatically. Their final consumption of milk decreases and dairy product consumption drops considerably. The derived demand of milk in dairy production increases, however, because of the higher prices for dairy products, benefiting dairy producers in these CEECs. Dairy exports of the three acceding countries to the EU–15 increase by one to three orders of magnitude, despite building large inventories. The impact of accession on world markets is small. À l'aide d'un modèle agricole à l'échelle mondiale, nous analysons l'impact des accords de Berlin sur la réforme de la Politique agricole commune (PAC) de l'Union Européenne, en ce qui touche les marchés laitiers. Nous examinons aussi les conséquences éventuelles de l'élargissement de l'Union Européenne à la République Tchèque, à la Hongrie et à la Pologne. Ces deux scénarios nous ont servi de base d‘élaboration de perspectives du marché jusqu'en 2010. Les accords de Berlin déclenchent une hausse duprix du lait et desproduits laitiers dans l'UE. Selon nos prédictions, on assiste après 2005 à un changement du prix relatif du fromage par rapport à celui de la poudre de lait écremé (PLE). II s‘ensuit une expansion de la production et de la consommation et des exportations defromage aux dépens du segment de la PLE. L'entrée des trois pays de l'Europe, du centre et de l'est (PECE) conduit à une baisse permanente, encore que modeste, des prix du lait et des produits laitiers dans l'UE. Chez les trois nouveaux arrivés, les prix intérieurs grimpent de façon spectaculaire, ce qui entraîne une chute de la consommation du lait particulièrement de celle des produits laitiers transformés. En revanche, la demande de lait industriel augmente à cause des prix plus élevés des produits dérivés, ce qui profite aux producteurs laitiers des trois pays. Les exportations laitières de ces pays augmentent de 1 à 3 ordres de grandeur, ce qui n'empèche pas la constitution de stocks importants. L'impact de l'accession sur leur marchés mondiaux devrait être de peu d'importance.     

Contractual Relations in Agricultural Credit Markets: A Hedonic Pricing Approach with Application to Poland

We present a micro‐econometric analysis of agricultural credit market outcomes in Poland that investigates the relationship between contractual arrangements and interest rates. An innovative theoretical framework based on a hedonic market model is developed. We interpret the factors that influence interest rates as ‘quality’ components of the credit contract. Using unique data allows us to consider both nominal interest rates and additional bank fees. The results show that banks have preferences for particularly liquid types of collateral, whereas they care little about the purpose for which the loan is used. Furthermore, the analysis allows quantification of the effects of socioeconomic attributes of farmers, different lending sources and government subsidies on interest rates. The latter effect is small compared with the officially declared reduction of the nominal interest rate. A simulation shows that enabling more borrowers to use liquid forms of collateral implies lower rates than those obtained by participating in the subsidy programme.     

中国生猪饲养业比较优势分析

生猪饲养业在中国畜牧业中占有重要的地位,对世界猪肉市场也有重要影响。本文利用国内资源成本模型对中国生猪养殖业的比较优势进行了实证研究,对农户散养、专业户饲养和国营集体大规模化饲养3种方式下生猪的比较优势的差异进行对比。研究从生猪饲养效率角度出发,对农户散养、专业户饲养和国营集体大规模化饲养的比较优势水平的差异进行了分析。     

The North American horticultural industry and the risk of plant invasion

We develop a monopolistic competition model of the horticultural industry and estimate the resulting profit function with U.S. and Canadian industry data. Combining the results with a hazard analysis of the characteristics of exotic plants introduced in North America, we explore optimal tax simulations for internalizing the risk and costs of a potential plant invasion. If the share of the exotic plant sales in final profits is large, then the resulting annual fee will be high, discouraging the expansion of the nursery industry. However, the annual revenues could fund efforts to mitigate the damages resulting from any accidental plant invasion.     

The Effects of Tariff Removals on the North American Lumber Trade

Under the North American Free Trade Agreement, the United States, Canada and Mexico are to remove all tariffs on softwood lumber. This paper examines the impact of loosening various present lumber trade restrictions on softwood lumber flows, prices and general economic welfare of these three countries. Some possible scenarios ranging from complete removal of tariffs on lumber trade throughout North America to a significant protection in this sector are examined. Using a spatial equilibrium model, we simulate various scenarios and quantify the effects of different levels of protection on lumber shipments and economic welfare in different geographical regions. According to our results, while lumber shipment will be affected significantly by trade liberalization, the overall of welfare will not change appreciably. L'ALENA engage les États-Unis, le Canada et le Mexique àéliminer tous les tarifs douaniers sur le bois d'oeuvre (bois tendre). Dans cet article nous examinons les conséquences éventuelles d'un relâchement des diverses restrictions actuelles au commerce du bois d'oeuvre sur le flux des échanges et sur le prix du bois, ainsi que sur la situation de bien-être générale dans ces trois pays. Quelques scénarios sont considérá, allant de l'abolition complète des tarifs sur ces denrees a la grandeur de l'Amérique du Nord au maintien d 'un niveau significatif de protection de ces secteurs. Au moyen d 'un modèle d'équilibre spatial nous simulons divers scénarios et nous quantifions les effets de differents niveaux de protection sur les échanges de bois d'oeuvre, ainsi que la situation économique dans les diverses regions géographiques du sous-continent. Il ressort de notre examen que même si les échanges de bois d'oeuvre seront touchés significativement par la libéralisation du commerce, la situation économique générate, c'est-à-dire le niveau de bien-être, ne changera pas beaucoup.     

The Local Economic Impacts of the North American Waterfowl Management Plan in Saskatchewan

The North American Waterfowl Management Plan seeks to improve wildlife habitat and increase waterfowl numbers through voluntary transactions with farmers to modify their land management practices. The impact of modified land use practices on the incomes of participating farmers and the regional economy are estimated. The compensation offered under the Plan for modification of land use is determined to adequately offset any loss in participants' income. Income losses to the community due to reduced farm input sales were more than offset by the increase in NAWMP direct expenditures (excluding compensation payments). Distributional effects and externalities must be recognized and monitored to ensure success of the program     

The Economics of a Single North American Barley Market

On I August 1993, the Canadian government extended the dual feed barley market to all of North America and established a similar marketing system for malting barley. The 1993 policy reform removed the Canadian Wheat Board's (limited) ability to set monopoly prices. While the loss of the board's domestic monopoly power was negative for farmers, there were offsetting positive impacts. The new policy will lead to economic gains for farmers due to improved price signals and competitive discipline in grain handling. The author concludes that the gains to farmers from a move to a single North American market far ourneigh any associated losses. Le 1^er août 1993, le gouvernement canadien étendait le système de double marché de l'brge fourragère a toute l'Amérique du Nord et instaurait un régime semblable pour l'orge de brasserie. La réforme de 1993 retirait à la Commission canadienne du blé son quasi-monopole sur l'établissement des prix. Bien que cette perte de monopole ait eu des effets négatifs pour les agriculteurs, elle a eu certaines incidences positives. La nouvelle politique apportera aux agriculteurs des gains économiques en leur envoyant des signalcx plus clairs sur les prix du marché, et aussi par l'instauration d'une discipline plus concurrentielle du réseau de manutention des céréales. L'auteur estime que les avantages pour les agriculteurs du passage à un marché unique pour l'Amérique du Nord compenseront largement les penes corollaires éventuelles que peuvent en découler.     

The North American Free Trade Agreement and the Canadian Agri-Food Sector

In the past five years, Canada has negotiated and ratified three trade agreements: the Canada-United States Free Trade Agreement (FTA), the North American Free Trade Agreement (NAFTA) and the multilateral free trade agreement now administered by the World Trade Organization (WTO). This paper focuses on the implications for agri-food trade of the NAFTA and its interface with the other two agreements. The provisions of the NAFTA are described and evaluated as they relate to market access, domestic support, export assistance, technical regulations and dispute settlement. Observations are presented on the NAFTA's potential effects on trade in red meats, grains and oilseeds, supply-managed commodities and horticulture. In addition, some of the shortcomings of the NAFTA are highlighted.     

Impact of Agriculture on Rural Tourism: A Hedonic Pricing Approach

The increased awareness of farmers' role in the maintenance of rural landscapes may contribute to a reassessment of the place of agriculture in society. In this paper, we look at how this role, in relation to landscape, is valued by rural tourists or, in other words, whether it is a response to a societal demand, as is argued by defenders of multifunctional agriculture. The results from a hedonic pricing analysis indicate that landscape features associated with agricultural activities (such as meadows and grazing cattle) positively influence the demand for rural tourism and have a positive impact on the price tourists are willing to pay for rural accommodation. This is also illustrated by the adverse impact of perceived negative externalities from agricultural production (such as intensive maize cultivation) on this price.     

Land Markets, Risk and Distress Sales in Nicaragua: The Impact of Income Shocks on Rural Differentiation

Farmers in the Nicaragua countryside face substantial risk due to legal uncertainty regarding property rights, price fluctuations and limited access to rural financial markets. Income shocks can lead to obligations to sell land, can fuel differentiation processes, and can drive people into poverty. We review empirical evidence on income shocks and related distress sales by households of different wealth endowments. From panel data of the 1995 and 2000 land market surveys, estimates are made to identify relevant farm household characteristics and the market forces that determine distress sales. Results show that small farms are most affected by idiosyncratic shocks and usually try to adopt a defensive strategy based on reduced consumption to retain their land resources. In the long run, this strategy occasionally succeeds in preserving land ownership and maintaining income at higher levels than those enjoyed by landless peasants. But the pressures towards distress sales can, nevertheless, be powerful, and different responses to income shocks by poor, middle and rich peasants are likely to increase rural differentiation.