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Incorporating Consumer Demand In Broiler Profit-Maximization Modeling

Author

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  • Costa, Ecio de Farias
  • Houston, Jack E.
  • Gunter, Lewell F.
  • Pesti, Gene M.

Abstract

Increased emphasis on consumer markets in broiler profit-maximizing modeling generates results that differ from those of traditional profit-maximization models. This approach reveals that the adoption of step-pricing and consideration of marketing options (examples of responsiveness to consumers) affect the optimal feed-formulation levels and types of broiler production to generate maximum profitability. With the adoption of step-pricing, higher profits can be obtained for targeted weights only if premium prices for broiler products are contracted.

Suggested Citation

  • Costa, Ecio de Farias & Houston, Jack E. & Gunter, Lewell F. & Pesti, Gene M., 2002. "Incorporating Consumer Demand In Broiler Profit-Maximization Modeling," Journal of Food Distribution Research, Food Distribution Research Society, vol. 33(3), pages 1-10, November.
    • Handle: RePEc:ags:jlofdr:26832
    DOI: 10.22004/ag.econ.26832
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    References listed on IDEAS

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    1. Costa, Ecio F. & Miller, Bill R. & Houston, Jack E. & Pesti, Gene M., 2001. "Production and Profitability Responses to Alternative Protein Sources and Levels in Broiler Rations," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 33(3), pages 567-581, December.
    2. Mariano J. Gonzalez-Alcorta & Jeffrey H. Dorfman & Gene M. Pesti, 1994. "Maximizing profit in broiler production as prices change: A simple approximation with practical value," Agribusiness, John Wiley & Sons, Ltd., vol. 10(5), pages 389-399.
    3. Allison, John R. & Baird, D. M., 1974. "Least-Cost Livestock Production Rations," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 6(2), pages 41-45, December.
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    1. Costa, Ecio de Farias & Houston, Jack E., 2006. "An Interactive Decision Model Integrating Broiler Production and Processing Responsiveness to Consumer and Producer Prices," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25295, International Association of Agricultural Economists.

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    Keywords

    Consumer/Household Economics;

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