Price Transmission and Asymmetric Adjustment in the U.S. Beef Sector

Abstract

Slaughter industries are consolidating, as the number of firms fal Is and plant sizes grow.Related changes are occurring in upstream livestock production sectors: large cattle feedlots and hog farms account for sharply growing shares of livestock sales.As in poultry, new contractual relationships have begun to replace spot market cash transactions for cattle and for hogs.Those sharp structural changes have raised concerns about market power, pollution control, and the reliability of traditional price reporting sources.This is a research conference, aimed at encouraging evaluation and discussion of research methods, data sources, and results.Topics covered at the conference include the following: * The existence, extent, and effects of market power in livestock and meat indutries;Causal factors in consolidation, such as scale and scope economies, mergers, changes in product mix, innovation, and changes in contractual relations; * Vertical coordination, as compared to spot markets for transferring livestock, including summaries of recent developments and implications for location, for product characteristics, and for price discovery; Externalities associated with consolidation, including the effects of larger animal production facilities on pollution and the effects of local control regulations on consolidation.