Tonsor, Glynn T.

By: Moon, Donghyun; Tonsor, Glynn T.
We conducted an event study to examine the effect of E. coli recalls on prices in the vertically connected U.S. beef industry. Our findings show that the resulting price changes of beef products vary across stages in the U.S. beef industry and that the prices of disaggregated beef products are more vulnerable to E. coli recalls than the prices of aggregated products. This suggests that downstream agents transacting specific ground beef products may be more adversely affected by E. coli recalls than upstream agents trading live animals.
By: Taylor, Mykel R.; Tonsor, Glynn T.
The 2014 Farm Bill offered producers a choice of programs to assist in risk management. Helping producers understand their choices among three programs, all with uncertain payouts determined by different factors, was a sizable challenge to extension economists tasked with providing Farm Bill education. Survey data collected at extension meetings were analyzed, and findings suggest that in-person extension education influences people’s decisions, especially with regard to uncertain outcomes like commodity prices, yields, and program payments. The finding that more experienced producers consistently chose one of the programs may have implications for policy impacts that differ across producer demographic groups.
By: Coffey, Brian K.; Tonsor, Glynn T.; Schroeder, Ted C.
Basis prediction errors for live cattle in the five major Mandatory Livestock Price Reporting areas are analyzed to determine how shifts in the live cattle market fundamentals and contemporaneous market conditions, including price momentum, impact ability to hedge. Results reveal that thinness of the negotiated cash market, weight of cattle marketed, and contemporaneous factors statistically impact basis prediction errors. Impacts vary across region. Volatility in cost of gain and delivery costs have greater effects on basis prediction error than do market trends.
By: Wolf, Christopher A.; Tonsor, Glynn T.
Consumers are increasingly scrutinizing the animal welfare implications of modern agricultural production processes. We used surveys to examine both the U.S. public willingness-to-pay for and dairy farmer willingness-to-supply or change on-farm production practices related to dairy cattle welfare and find that the public has a positive WTP for all practices examined, while most dairy farms already supply those practices (with the exceptions of employee training programs, third-party certification, and outdoor access). Implications for practice verification and premiums are discussed in the context of dairy markets and policy.
By: Wolf, Christopher A.; Tonsor, Glynn T.
Dairy policy often becomes a contentious topic during U.S. farm bill negotiations. The dairy subtitle of the 2012 farm bill has been debated and discussed since 2009. This research uses best-worst scenario methods to analyze dairy farmer preferences for policy options, including eliminating existing dairy policies, implementing new dairy policies related to income support and growth management, and ending ethanol subsidies. Results indicate that large and small dairy herd operators have differing preferences. Large herd operators prefer to end ethanol subsidies rather than specific dairy policy changes, while small herd operators most preferred support for income over feed-cost margins.
By: Taylor, Mykel R.; Tonsor, Glynn T.
Proponents of the U.S. mandatory country-of-origin labeling (MCOOL) law have argued that consumers prefer domestic meat and value labels confirming domestic origin. Following legislation enacted in March 2009, an ex post analysis of demand is possible to evaluate relative costs and benefits of MCOOL. This study uses retail grocery-store scanner data to estimate a Rotterdam demand model of meat products. The model results failed to detect changes in consumer meat demand post-MCOOL. Given the costs of compliance incurred by meat processors and no evidence of increased demand, our results suggest that producers and consumers have experienced a welfare loss.
By: Schroeder, Ted C.; Tonsor, Glynn T.
The Food and Drug Administration recently approved the feeding of Zilmax(R) for cattle in the United States. This study determines direct net return benefits for early-adopting cattle feeders and beef packers. In addition, longer-run producer and consumer surplus measures are estimated as adoption impacts market prices and quantities. After markets adjust, cow-calf producers, cattle feeders, and consumers will gain from adopting the new technology.
By: Wolf, Christopher A.; Tonsor, Glynn T.; Olynk, Nicole J.
A choice experiment was used to examine the value of various fluid milk attributes. Respondents were surveyed regarding half or whole gallon milk purchases. A split-sample design was used to examine consumer inferences regarding food safety. Willingness to pay for verification of production process attributes varied across attributes and verifying entity. Consumers were generally willing to pay substantial premiums for milk produced without the use of rbST, on local family farms, with assured food safety enhancement, and for these claims to be verified by the U.S. Department of Agriculture.
By: Olynk, Nicole J.; Tonsor, Glynn T.; Wolf, Christopher A.
A choice experiment was used to determine consumer value for verification of livestock production process attributes. Willingness to pay for verification of production process attributes varied for both milk and pork chops across attributes and verifying entity. Statistically significant evidence of social desirability bias was found by comparing estimates of consumer preferences solicited using direct and indirect questioning. Indirect questioning may yield more accurate representations of consumer value than direct questioning, and therefore more accurate estimates for agribusiness decision making.
By: Tonsor, Glynn T.; Mintert, James R.; Schroeder, Ted C.
This article uses national, quarterly data to examine U.S. meat demand using the Rotterdam model. We investigate the effect of multiple information indices linking different health concerns with diet, changes in household dynamics, and meat recall information. Medical journal articles linking iron, zinc, and protein with health and diet increase beef and poultry demand, whereas articles dealing with fat, cholesterol, and diet concerns reduce beef demand. Increasing consumption of food away from home enhances pork and poultry demand while reducing beef demand. Combined, these results provide a more complete and current understanding of the impact of multiple information factors faced by U.S. consumers.
By: Tonsor, Glynn T.; Schroeder, Ted C.; Fox, John A.; Biere, Arlo W.
A choice experiment is used to evaluate how consumers in London, Frankfurt, and Paris value beef steaks with attributes such as: "hormone-free," "GM-free," farm-specific source verification, and domestic origin. The effect of various consumer characteristics on steak selection is also evaluated. Results suggest that European consumers are significantly heterogeneous in their preferences for beef steak attributes. French and German consumers have a higher willingness to pay to avoid genetically modified feed use than British consumers, while German and British consumers would pay more for growth hormone-free beef. French and German consumers are willing to pay for farm-specific source verification.
By: Tonsor, Glynn T.; Dhuyvetter, Kevin C.; Mintert, James R.
Successful risk management strategies for agribusiness firms based on futures and options contracts are contingent on their ability to accurately forecast basis. This research addresses three primary questions as they relate to basis forecasting accuracy: (a) What is the impact of adopting a time-to-expiration approach, as compared to the more common calendar-date approach? (b) What is the optimal number of years to include in calculations when forecasting livestock basis using historical averages? and (c) What is the effect of incorporating current basis information into a historical-average-based forecast? Results indicate that use of the time-to-expiration approach has little impact on forecast accuracy compared to using a simple calendar approach, but forecast accuracy is improved by incorporating at least a portion of current basis information into basis forecasts.