Price Differentials for Complete Feeds, Supplements, and Shelled Corn: A Regression Analysis

Nelson, Paul E.,

No 307435, Agricultural Economic Reports from United States Department of Agriculture, Economic Research Service

Abstract: Farm expenditures for feed increased substantially between 1960 and 1969. Their proportion of total production expenses fluctuated between 17 and 21 percent. The importance of feed expenditures encourages a continuing farm interest in feed prices and regional price differences. An explanatory model was developed. The Pesticide and General Farm Survey, 1966-67, was adopted as a means for obtaining the information necessary to apply the model. The purpose of the model was to explain different levels of prices paid for complete feeds, specified supplements, and shelled corn. Variation in the independent variables of the model was associated with 16 to 54 percent of the total price variance, depending upon the product. The most consistent variables were protein content and bulk purchasing. Each added percentage of protein increased price from 3 cents to 20 cents per hundredweight. Bulk purchasing decreased price from 6 cents to 20 cents per cwt. Prior to the deductions of discounts, prices reported by respondents listing discounts, averaged higher than the prices reported by respondents not reporting discounts received. Large-scale operations reported lower prices than the smaller sized firms. The variation in average prices reported by source of purchase was sufficiently great so that no single source could be cited as always charging the lowest prices.

Keywords: Demand and Price Analysis; Livestock Production/Industries; Production Economics; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 37
Date: 1971-02
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uerser:307435

DOI: 10.22004/ag.econ.307435

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