 Determinants of the Farm-To-Retail Milk Price SpreadBrandon Hansen, William Hahn () and Mark Weimar No 309708, Agricultural Information Bulletins from United States Department of Agriculture, Economic Research Service Abstract: Farm-to-retail milk price spreads increased significantly during late 1990 and early 1991 as farm prices decreased while retail prices either stayed the same or else went down more slowly. In this report, farm-level fluid milk prices and processor costs are estimated from USDA's Agricultural Marketing Service data and from firm level data acquired from a private cost-accounting company for the period 1974-91. These data indicate that the greatest portion of the farm-to-retail price spread increase occurred at the retailer level. Processor profits also increased but not enough to account for the increased price spread. Comparisons of the fluid milk price spread with other food price spreads indicate that the milk price spread had lagged behind other food price spreads since 1986 but then caught up in 1990 and 1991. A study of price transmission between 1983 and 1990 indicates that retail prices react more quickly and completely to farm price increases than to farm price decreases. Keywords: Demand and Price Analysis; Livestock Production/Industries; Production Economics (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ags:uersab:309708 Access Statistics for this paper More papers in Agricultural Information Bulletins from United States Department of Agriculture, Economic Research Service Contact information at EDIRC. |
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