Positive Market Effects from a Meatpacking Plant Opening: Perceptions and Reality
AbstractEconomic theory suggests that adding a competitive buyer to a market should have positive effects on competition and prices, ceteris paribus. An additional buyer increases market demand, shifting demand to the right, and expands the number of active buyers, reducing average market shares of existing buyers while intensifying bidding competition. Whether or not these positive impacts occur in reality is an empirical question. The largest pork processor in Canada, Maple Leaf Foods Inc., opened a 45,000 head/week hog processing facility in August 1999 in Brandon, Manitoba. The plant opened during a period of expanding hog production in Canada, of increasing hog exports to the United States, and of increasingly tight processing capacity in the United States (Luby, 1999; Parcell, Mintert, and Plain, 2004). Most previous research on the impacts of meat processing plants has focused on plant closings, and none has estimated the effects of a plant opening under conditions of expanding production and tight processing capacity. Research reported here expands previous work by taking a dual approach to the question. First, two models were used to estimate market price impacts from the plant opening. Second, a survey of Manitoba pork producers provided insight into the perceived market dynamics of the plant opening.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Canadian Agricultural Economics Society in its journal CAFRI: Current Agriculture, Food and Resource Issues.
Volume (Year): (2005)
Issue (Month): 06 ()
Agribusiness; Demand and Price Analysis;
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Gervais, Jean-Philippe & Schroeder, Ted C., 2005.
"Structural Implications of Persistent Disharmony in North American Beef and Pork Industries,"
North American Agrifood Market Integration Workshop II: Agrifood Regulatory and Policy Integration under Stress, May 2005, San Antonio, Texas
17998, Farm Foundation.
- Gervais, Jean-Phillipe & Schroeder, Ted, 2005. "Structural Implications of Persistent Disharmony in North American Beef and Pork Industries," 2005 NAAMIC Workshop II: Agrifood Regulatory and Policy Integration under Stress 163861, North American Agrifood Market Integration Consortium (NAAMIC).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.