Progress 10/01/00 to 09/30/06
A study of farmers' retirement portfolios was completed. Increased predictability of climate changes associated with El Nino Southern Oscillation (ENSO) was shown to help reduce farm risk by timing the selection of crop insurance products to coincide with predictions of the severity of those events. The current state of the satsuma marketing effort in the Gulf States was summarized, and recommendations were made for development of a regional brand. Conjoint analyses were conducted to determine consumer preferences for satsumas, mandarins, watermelons, peanuts, and bell peppers. Consumer taste preferences were evaluated for peanuts, mandarins and catfish nuggets. Enterprise and risk analyses were conducted for Bt cotton, hybrid catfish fingerlings, airlift aeration in catfish cage culture, red snapper fry nursery systems, and sustainable tomato production practices. Risk transfers in the broiler and cattle industries were analyzed. Determinants of vertical integration
in the food industry were evaluated and found to be highly heterogeneous and specific to the SIC-category of food manufactured.
Farmer retirement portfolios will be adversely affected by proposed changes in the Social Security retirement system. Farmers are now advised to set aside additional savings in a private annuity to offset reductions in expected returns from the government-backed annuity. Crop insurance portfolios can now be improved by accounting for seasonal climate variability due to El Nino and La Nina events. Satsuma producers and distributors now have less uncertainty about what various consumer segments desire in terms of fruit attributes, and about the trade-offs in terms of retail price and cost of production for various combinations of attributes. Peeled-and-sectioned satsumas showed great market potential. Several of the other novel products and processes (see above) are now in various stages of commercialization, with the caveat that their high average returns are generally accompanied by wider variation in the distribution of possible returns, i.e. higher risk. The broiler
analysis provides evidence that contracting does not eliminate risk for broiler producers.
- Nelson, R.G., B.L. Campbell, R.C. Ebel, and W.A. Dozier. 2006. The current state of the satsuma marketing effort in the Gulf states. HortScience 41(4):916-917.
- Cabrera, V.E., C.W. Fraisse, D. Letson, G. Podesta and J. Novak. 2006. Impact of climate information on reducing farm risk by optimizing crop insurance strategy. Transactions of the American Society of Ag. and Biological Engineering. Vol. 49(4):1223-1235.
- Campbell, B.L., R.G. Nelson, R.C. Ebel, and W.A. Dozier. 2006. Mandarin attributes preferred by consumers in grocery stores. HortScience 41(3):664-670.
- Diabate, Y. 2006. Vertical Integration and Coordination in the Food Manufacturing Industry, 1967-1992. Ph.D. dissertation, Auburn University.
Progress 01/01/05 to 12/31/05
Completed study of farmer's retirement portfolio. Presentations were made and abstracts published in the Journal of Agricultural and Applied Economics. Completed study of mandarin attributes preferred by grocery store shoppers (sweet citrus variety, package, price, shelf life, and vitamin C). Completed analysis of the influence of soluble solids and acidity on in-store consumer taste preferences for satsumas, tangerines, and clementines. Contributed economic analysis of field trials for sustainable tomato production. Used broiler grower data to analyze how the days out (days between flocks) is influenced by the broiler market. A strong negative relationship was found between days out and monthly integrator returns (USDA data). Thus, integrators transfer, in part, the risk of a soft wholesale market to contract growers.
Farm assets can appear to supply farmers' retirement needs, but liquidity is problematic. Farmer retirement portfolios will be influenced by changes in the Social Security retirement system. Additional savings will be required to substitute a government-backed annuity with a private annuity. Farmers as a group are wealthier and will experience less of an impact than the general public. However the distribution of such impacts is highly skewed. Satsuma producers and distributors now have less uncertainty about what various consumer segments desire in terms of fruit attributes, and about the trade-offs in terms of retail price and cost of production for various combinations of attributes (sweet citrus variety, package, price, shelf life, and vitamin C). Peeled-and-sectioned satsumas showed great market potential, but should be offered in a product mix that includes the loose form as well. The broiler analysis helps dispel the myth that contracting eliminates risk.
- Novak, James L., Paul Gentle, Patricia Duffy and Allison Keefe. "Farmers and Social Security Reform." Choices 20(2):157-160. 2005.
- Novak, James L. and Larry Sanders. "Policy Implications of Federal Deficits for Agriculture and Rural Communities." J. Ag. and Applied Economics 37(2):516. 2005.
- Sanders, Larry D. Sanders, James Novak and Janie Hipp. "Obesity, Food Labeling and Food Policy: Issues/Impacts for Southern Agriculture." J. Ag. and Applied Economics 37(2):518. 2005.
- Nelson, R.G., C.M. Jolly, M.J. Hinds, Y. Donis and E. Prophete. "Conjoint Analysis of Consumer Preferences for Roasted Peanut Products in Haiti." International J. Consumer Studies 29(3):208-215. 2005.
- Nelson, R.G., C.M. Jolly, M.J. Hinds, Y. Donis and E. Prophete. "Consumer Preferences for Peanut Butter (Mamba) Products in Haiti: A Conjoint Analysis." Peanut Science (30):99-103. 2003. (note: publication of Issue 30, dated 2003, was delayed -- this article did not appear in print until 2005)
- Taylor, C. R. "Establishing Fairness in Contract Poultry Production," Organization for Competitive Markets Newsletter, June 2005.
Progress 01/01/04 to 12/31/04
Completed study of external fruit quality attributes (color, size, seeds, blemishes, price, production region, and organic production) that affect consumers' preferences for satsuma mandarins. Collaborated on study of consumers' preferences for sweet citrus variety, package type, shelf life, vitamins and price. Collaborated on conjoint study of consumer preferences for watermelon attributes. Initiated risk analyses of pond nursery systems for red snapper fry, and choice of sustainable tomato production practices. Completed study of farmer's retirement portfolio. Submitted two articles for publication to the Journal of Agricultural and Applied Economics and CHOICES.
Satsuma producers and distributors now have less uncertainty about what various consumer segments desire in terms of fruit attributes, and about the trade-offs in terms of retail price and cost of production for various combinations of attributes (color, size, seeds,blemishes, etc). Risk analyses help identify production practices that balance profit potential with riskiness (probabilities of negative returns or bankruptcy). Farm assets, if liquid, can provide farmers retirement needs. However, liquidity is problematic. Farmer retirement portfolios will be impacted by changes in the Social Security retirement system. Additional savings will be required to substitute a government backed annuity with a private annuity. Farmers as a group are wealthier and will experience less of an impact than the general public. However the distribution of such impacts is highly skewed.
- Campbell, B.L., Nelson, R.G., Ebel, R.C., Dozier, W.A., Adrian, J.L. and Hockema, B.R. 2004. Fruit quality characteristics that affect consumer preferences for satsuma mandarins. HortScience 39(7):1664-1669.
Progress 01/01/03 to 12/31/03
Completed conjoint study of consumer preferences for satsumas. Collaborated on presentations dealing with peanut marketing in Haiti, fruit quality in satsumas, and optimal stocking densities for hybrid catfish fingerlings. Initiated study of taste preferences for satsumas. Completed draft manuscript on proposed changes in Social Security and implications for farmer retirement income.
Satsuma producers and distributors now have less uncertainty about what various consumer segments desire in terms of fruit quality, and about the trade-offs in terms of retail price and cost of production for various combinations of attributes (color, size, seeds, blemishes, etc). Haitian peanut producers and importers can choose what characteristics of roasted peanuts and peanut butter will appeal most to their customers, thus increasing revenues and reducing marketing risk. Farm assets, if liquid, can provide farmers retirement needs. However, liquidity is problematic.
- Hinds, M.J., Jolly, C.M., Nelson, R.G., Donis, Y., and Prophete, E. 2003. "Comparative Study of Properties and Acceptability of Haitian and US Honey-Roasted Peanuts." International J. Consumer Studies 27(2):157-167.
- Hinds, M.J., Jolly, C.M., Nelson, R.G., Donis, Y., and Prophete, E. 2002. "Consumer Acceptability and Physicochemical Properties of Haitian Peanut Butter-type Products (Mambas) Compared with US Peanut Butter." Peanut Science (29):102-109.
Progress 01/01/02 to 12/31/02
Completed a study of consumer preferences for and physicochemical properties of peanuts and peanut butter. Conducted a survey of consumer preferences for satsumas. Determined optimal stocking densities for hybrid catfish fingerlings based on pond experiments. Evaluated optimal marketing strategies for feeder cattle enterprises in relation to cattle cylces. Southern farmer information was extracted from the National Policy survey conducted in 2001 to determine southern producer preferences for a farm bill results presented at the Southern Ag. Economics Association annual meeting. Farmer retirement alternatives manuscript under preparation for journal submission.
The two consumer preference studies provided producers with information on the attributes that consumers value most, thus reducing production uncertainties and increasing the value of their product. The research on optimal stocking densities will help increase economic efficiency and profits for hybrid catfish fingerling producers. Knowledge of marketing strategies that take into account the cattle cycle will help feeder cattle producers optimize their marketing choices and risk management options. Increased knowledge of policy alternatives for southern producers.
- Hinds, M.J., C.M. Jolly, R.G. Nelson, Y. Donis, and E. Prophete. 2002. "Acceptability of Honey-Roasted Peanuts by Haitian Consumers." 2002 Annual Meeting of the Institute of Food Technologists, Anaheim, California. p. 100.
- Hinds, M.J., C.M. Jolly, R.G. Nelson, Y. Donis, and E. Prophete. 2002. "Acceptability of Haitian Peanut Butter-Type Products (Mambas)." 2001 Proceedings of the American Peanut Research and Education Society, Inc., Oklahoma City, Oklahoma. pp. 44-45.
- Hakobyan, A., J. W. Prevatt, R. Martin, and R. Nelson. 2002. "Evaluation of Optimal Marketing Strategies for Feeder Cattle Enterprises." Poster presented at the Southern Agric. Economics Association meetings, Orlando, FL, February, 2002. Abstract in Journal of Agricultural and Applied Economics 34(2):387.
Progress 01/01/01 to 12/31/01
A stochastic analysis of airlift aeration options in catfish cage culture was completed. A conjoint analysis of consumer preferences for attributes of bell peppers was completed. Vertical integration in the catfish industry was examined. Three years of rent distributions for Bt cotton were estimated and examined for sensitivity to yield reductions. A conjoint analysis of Haitian consumer preferences for peanut products was initiated. A discussion of risk consequences was provided to producers, educators, and legislators in deliberations on the 2002 Farm Bill. Information on risk preferences of farmers was provided to policy makers involved in drafting the 2002 Farm Bill.
Partial aeration was found to be the risk-neutral choice for Piedmont catfish farmers, improving efficiency of production in cages. Several market segments were identified for bell peppers based on color, price, and vitamin C content, suggesting opportunities for product differentiation and more choices for consumers. Farmer-share of surplus generated from adoption of Bt cotton was shown to be about equal to that of the seed selling firms, and this was consistent over three years of data, demonstrating that adopting farmers benefit considerably from this biotechnology, and not all the benefits go to the seed sellers. New markets and peanut products were suggested to boost domestic sales of Haitian peanuts. Risk information contributed to better decision-making in drafting the 2002 Farm Bill.
- Nelson, R.G., S.A. Duarte, and M.P. Masser. 2001. "Financial Risk Analysis of Three Aeration Regimes in Catfish Cage Culture." Aquaculture Economics and Management 5(3/4):171-177.
- Frank, C.A., R.G. Nelson, E.H. Simonne, B.K. Behe, and A.H. Simonne. 2001. "Consumer Preferences for Color, Price, and Vitamin C Content of Bell Peppers." HortScience 36(4):795-800.
- Morley, Z. 2001. An Assessment of Vertical Integration in the Catfish Industry. M.S. Thesis, Auburn University.
- Falck-Zepeda, J.B., G. Traxler, and R. G. Nelson. 2001. "Cotton GMO Adoption and Private Profitability." Chapter 6, pp. 47-58 in Genetically Modified Organisms in Agriculture, G. C. Nelson ed. Academic Press: San Diego, CA.
- Nelson, R., C. Jolly, M. Hinds, Y. Donis, and E. Prophete. 2001. "Consumer Preferences for Peanut Products in Haiti." Presented at the Southern Agricultural Economics Association meetings, Ft. Worth, TX, January, 2001. Abstract in Journal of Agricultural and Applied Economics 33(3):622.
- Harwood, J. and J. Novak. 2001. "Crop Insurance and Disaster Assistance." pp. 43-48 in 2002 Farm Bill Policy Options and Consequences. National Public Policy Education Committee, Pub. No. 2001-01, September. Farm Foundation, Oak Brook ,IL.
- Lubben, B. D., C. Simons, N.L. Bills, N.L. Meyer, and J.L. Novak. 2001. The 2002 Farm Bill: U.S. Producer Preferences for Agricultural, Food, and Public Policy. National Public Policy Education Committee, Pub. No. 2001-02, September. Farm Foundation, Oak Brook, IL.