Research Bulletin (Iowa Agriculture and Home Economics Experiment Station)


The sharp fluctuations in beef cattle and hog prices that have occurred since the end of World War II were partly the result of changes in the quantities of livestock produced. Other factors were present which also affected the level and pattern of livestock and meat prices. Disposable personal income per capita increased about 20 percent in real dollars during the 10-year period, 1947-56. A gradual shift in demand from pork to beef persisted throughout this period. Marketing costs increased sharply. Finally, the market structure was in the process of change and adaptation to the increasing demands for "built-in" maid services and other marketing innovations. These changing economic factors affect the accuracy of livestock price forecasts.

In this study, alternative methods of forecasting changes in beef and pork prices were derived from quarterly data covering the 32-quarter period, 1949 through 1956. The alternative forecasting equations were used to obtain several sets of predicted prices for each of the three major market levels-primary, wholesale and retail. Comparisons of the reported and predicted prices provided a test of predictive accuracy.



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