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Predicting food safety losses in turkey processing and the economic incentives of hazard analysis and critical control point (HACCP) intervention

Author

Listed:
  • William E. Nganje

    (Department of Agribusiness and Applied Economics, North Dakota State University, Fargo, ND 58105)

  • Mounir Siaplay

    (Department of Agricultural Economics, Oklahoma State University, Stillwater, OK 74078)

  • Simeon Kaitibie

    (Department of Agribusiness and Applied Economics, North Dakota State University, Fargo, ND 58105)

  • Emmanuel T. Acquah

    (Office of the Associate Vice President for Academic Affairs and Director of International Programs, University of Maryland Eastern Shore, Princess Anne, MD 28153)

Abstract

Turkey is an important food commodity whose total value of U.S. production amounted to $2.72 billion in 2003. Empirical evidence suggests that among broilers, eggs, turkeys, and chickens, Salmonella contamination of ground turkey is highest at 49.9% prior to hazard analysis and critical control point (HACCP) implementation and 26.6% after HACCP implementation. Salmonella and other microbial outbreaks have greatly contributed to the large number of food recalls in the meat and poultry industry; therefore, processed turkey constitutes a prime commodity for HACCP intervention analysis. Value-at-risk provides a framework for assisting firm management to assess food safety risks in monetary terms, and to evaluate the economic incentives of control measures like HACCP. Results show that food safety losses as measured by downside risk significantly declined following HACCP implementation. Medium- and large-scale turkey processors are more likely to derive more benefit from implementing an augmented HACCP plan than a generic HACCP plan. [EconLit citations: C150, Q180] © 2006 Wiley Periodicals, Inc. Agribusiness 22: 475-489, 2006.

Suggested Citation

  • William E. Nganje & Mounir Siaplay & Simeon Kaitibie & Emmanuel T. Acquah, 2006. "Predicting food safety losses in turkey processing and the economic incentives of hazard analysis and critical control point (HACCP) intervention," Agribusiness, John Wiley & Sons, Ltd., vol. 22(4), pages 475-489.
  • Handle: RePEc:wly:agribz:v:22:y:2006:i:4:p:475-489
    DOI: 10.1002/agr.20098
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    References listed on IDEAS

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    1. Crutchfield, Stephen R. & Buzby, Jean C. & Roberts, Tanya & Ollinger, Michael & Lin, Chung-Tung Jordan, 1997. "Economic Assessment of Food Safety Regulations: The New Approach to Meat and Poultry Inspection," Agricultural Economics Reports 34009, United States Department of Agriculture, Economic Research Service.
    2. Jose A. Lopez, 1996. "Regulatory Evaluation of Value-at-Risk Models," Center for Financial Institutions Working Papers 96-51, Wharton School Center for Financial Institutions, University of Pennsylvania.
    3. Ollinger, Michael & MacDonald, James M. & Madison, Milton E., 2000. "Structural Change In U.S. Chicken And Turkey Slaughter," Agricultural Economics Reports 34049, United States Department of Agriculture, Economic Research Service.
    4. Buzby, Jean C. & Fox, John A. & Ready, Richard C. & Crutchfleld, Stephen R., 1998. "Measuring Consumer Benefits of Food Safety Risk Reductions," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 30(01), pages 69-82, July.
    5. Nganje, William E. & Mazzocco, Michael A. & McKeith, Floyd K., 1999. "Food Safety Regulation, Product Pricing, And Profitability: The Case Of Haccp," AE Series 23077, North Dakota State University, Department of Agribusiness and Applied Economics.
    6. John M. Antle, 2000. "No Such Thing as a Free Safe Lunch: The Cost of Food Safety Regulation in the Meat Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 310-322.
    7. Martinez, Stephen W., 2002. "Vertical Coordination Of Marketing Systems: Lessons From The Poultry, Egg, And Pork Industries," Agricultural Economics Reports 34051, United States Department of Agriculture, Economic Research Service.
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