Journal Article

Determination of Focal Pricing Regions for U.S. Fed Cattle

Allan M. Walburger and Kenneth A. Foster

in American Journal of Agricultural Economics

Published on behalf of Agricultural and Applied Economics Association

Volume 80, issue 1, pages 84-95
Published in print February 1998 | ISSN: 0002-9092
Published online February 1998 | e-ISSN: 1467-8276 | DOI: http://dx.doi.org/10.2307/3180271
Determination of Focal Pricing Regions for U.S. Fed Cattle

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Concerns over the imperfect market structure of the beef sector arise due to potential price discovery impacts. This study presents an effective way of providing information on price discovery that can be used to indicate regions within which prices follow similar dynamics. A state space model was fit to fourteen years of weekly data on nineteen price series from U.S. fed cattle markets. Tight regional market price interrelationships were discovered indicating that, in general, prices cannot move independently in the long run. The dynamics of the system of prices revealed the existence of between five and seven focal price discovery regions.

Keywords: fed cattle; geographic markets; market structure; price discovery; state space; Q130

Journal Article.  0 words. 

Subjects: Agricultural Economics

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