Hay Price Forecasts at the State Level
AbstractHigher prices for major crops (e.g., corn, soybeans and wheat) have received considerable attention by analysts, researchers, and producers. A common perception is that acres can be readily bid away from other crops to quickly return to equilibrium price levels. Seldom mentioned are crops that do not trade on a national platform. Principal among these crops probably would be hay from alfalfa and grass. A balance sheet model is developed at the state level for South Dakota. As a state with typically large carryover stocks of hay and multiple markets served, South Dakota presents a stark contrast to states with more stable production, supply, and use. Several structural relations and equations are presented to forecast acres, supply, and price through an inverse demand function. A discussion follows on how to update the price forecast as additional information is obtained. Suggestions are also offered on extending the model to other states.
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Bibliographic InfoPaper provided by South Dakota State University, Department of Economics in its series SDSU Working Papers in Progress with number 22008.
Length: pages 17 pages
Date of creation: Apr 2008
Date of revision:
alfalfa price; feed demand; perennial crop; hay stocks;
Find related papers by JEL classification:
- Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
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