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International Comparison of Cost and Efficiency of Corn and Soybean Production

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  • Lunik, Elizabeth
  • Langemeier, Michael

Abstract

The objective of this paper was to examine the cost efficiency of corn and soybean production for typical farms involved in the cash crop agri benchmark network. Using a data envelopment analysis (DEA) approach, efficiency indices were computed for 35 corn farms, representing 15 countries including Argentina, Bulgaria, Brazil, China, Czech Republic, France, Hungary, Italy, Poland, Russia, Ukraine, United States, Uruguay, Vietnam, and South Africa. Average technical efficiency was 0.497, average allocative efficiency was 0.487, and average cost efficiency was 0.310. Efficiency indices were also found for 18 soybean farms, representing 9 countries, including Argentina, Brazil, Canada, China, Italy, Ukraine, United States, Uruguay, and South Africa. Average technical efficiency was 0.533, average allocative efficiency was 0.553, and average cost efficiency was 0.340. Correlation analysis shows that seed input cost shares were the most correlated with cost efficiency for soybeans, while fixed capital cost shares were the most correlated with cost efficiency for corn production. OLS regression indicated that land, labor and other direct services were under-utilized for corn production, and that seed was over-utilized for soybean production.

Suggested Citation

  • Lunik, Elizabeth & Langemeier, Michael, 2015. "International Comparison of Cost and Efficiency of Corn and Soybean Production," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196885, Southern Agricultural Economics Association.
    • Handle: RePEc:ags:saea15:196885
    DOI: 10.22004/ag.econ.196885
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    References listed on IDEAS

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    1. Afriat, Sidney N, 1972. "Efficiency Estimation of Production Function," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 13(3), pages 568-598, October.
    2. Seiford, Lawrence M. & Thrall, Robert M., 1990. "Recent developments in DEA : The mathematical programming approach to frontier analysis," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 7-38.
    3. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    4. Fare, Rolf & Grosskopf, Shawna & Logan, James, 1983. "The relative efficiency of Illinois electric utilities," Resources and Energy, Elsevier, vol. 5(4), pages 349-367, December.
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    Cited by:

    1. Li Ma & Chuangang Li & Minghan Xin & Nan Sun & Yun Teng, 2023. "Analysis of Efficiency Differences and Research on Moderate Operational Scale of New Agricultural Business Entities in Northeast China," Sustainability, MDPI, vol. 15(12), pages 1-21, June.

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    Keywords

    Agricultural and Food Policy; Farm Management; Production Economics; Productivity Analysis;
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