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A Component Pricing System For Pork

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  • Manuey, Sean
  • Brorsen, B. Wade
  • Akridge, Jay T.

Abstract

Value-based marketing of pork has become much more prevalent over the past five years in the United States. However, the National Pork Producers Council (NPPC), through its Lean Value Task Force, has expressed concern that current value-based marketing systems are not adequate in conveying consumer preferences back to the producer. In response, the NPPC issued a call for a system which priced animals based on 'pounds of quality lean'. This paper presents a value-based marketing system developed in response to this call. The component pricing models are clearly more accurate than live weight pricing. Adding more components improves the precision of the component model. The TOBEC device provides the most accurate estimates of carcass composition and value. The optical probe, while slightly less accurate than the TOBEC device, produces unbiased estimates of carcass value which are more accurate than pricing on a live weight basis.

Suggested Citation

  • Manuey, Sean & Brorsen, B. Wade & Akridge, Jay T., 1991. "A Component Pricing System For Pork," 1991 Annual Meeting, August 4-7, Manhattan, Kansas 271067, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea91:271067
    DOI: 10.22004/ag.econ.271067
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    References listed on IDEAS

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    1. Marvin L. Hayenga & Barbara S. Grisdale & Robert G. Kauffman & H. Russell Cross & Lauren L. Christian, 1985. "A Carcass Merit Pricing System for the Pork Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(2), pages 315-319.
    2. Hayenga, Marvin L. & Grisdale, Barbara & Kauffman, Robert G. & Cross, H. R. & Christian, Lauren L., 1985. "Carcass Merit Pricing Systems in the Pork Industry," Staff General Research Papers Archive 11308, Iowa State University, Department of Economics.
    3. Updaw, Nelson J. & Bullock, J. Bruce & Nichols, T. E., 1976. "Pricing Soybeans on the Basis of Oil and Protein Content," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 8(2), pages 129-132, December.
    4. Updaw, Nelson J. & Bullock, J. Bruce & Nichols, T.E., Jr., 1976. "Pricing Soybeans On The Basis Of Oil And Protein Content," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 8(2), pages 1-4, December.
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    Cited by:

    1. Boland, Michael A. & Preckel, Paul V. & Schinckel, Allan P., 1993. "Optimal Hog Slaughter Weights Under Alternative Pricing Systems," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 25(2), pages 1-16, December.
    2. Ted C. Schroeder, 1993. "An evaluation of hog carcass merit pricing systems," Agribusiness, John Wiley & Sons, Ltd., vol. 9(4), pages 339-350.
    3. M. A. Boland & K. A. Foster & J. T. Akridge, 1995. "Packer sorting strategies for fresh pork," Agribusiness, John Wiley & Sons, Ltd., vol. 11(5), pages 423-430.

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