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Abstract
In this paper a multiple-output cost function framework is proposed to construct
national feed balances or feed utilisation matrices (FUMs). The framework is applied to the
Belgian compound feed industry. For estimation purposes a Symmetric Generalised McFadden
(SGM) cost function is selected. The cost function is estimated using readily available
time-series data for the period 1962-88. Unlike previous studies based on duality theory,
this study exploits the properties of nonjointness in animal feed production to establish a
complete FUM. The allocation of feed ingredients among different livestock categories as
well as the composition of various compound feeds are identified. Also own- and cross-price
elasticities of demand for feed ingredients by type of livestock are reported.