The Effect Of Lost Exports On U.S. Beef Prices
AbstractSince the discovery of Bovine Spongiform Encephalopathy (BSE) in the United States in December 2003, U.S. beef exports have declined approximately 85 percent. A number of countries, including Japan and Korea (the top export markets for U.S. beef), have banned imports of beef from the United States, while U.S. exports to other important markets, such as Mexico and Canada, have been well below previous levels. Domestic demand in the United States was not significantly affected by the BSE discovery, but the effect of decreased beef exports on U.S. price is significant. This study examines the effect of exports and other supply and demand factors on U.S. meat prices, and estimates the effect of the drop in exports on U.S. beef and cattle prices. Results indicate that if all other factors remain the same, the drop in exports results in a $0.22 per pound reduction in retail beef prices and a $0.04 per pound reduction in the slaughter steer price. Prices in 2004 remained relatively high, however, possibly due to a decline in U.S. production and strong domestic demand.
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Bibliographic InfoPaper provided by North Dakota State University, Department of Agribusiness and Applied Economics in its series Agribusiness & Applied Economics Report with number 23571.
Date of creation: 2005
Date of revision:
Bovine Spongiform Encephalopathy; beef; pork; chicken; exports; International Relations/Trade;
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- DeVuyst, Cheryl Sinn & DeVuyst, Eric A., 2005. "Indemnifying Asset Value Losses Related to Livestock Disease Announcements," Western Economics Forum, Western Agricultural Economics Association, vol. 4(02).
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