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Abstract

Corn constitutes about 60 % of the normal poultry diet, and the remaining ingredients are soybean meal(Leeson and Summers 2005). The feed cost represents about 70% of the operation cost shares in poultry production. So any increase in corn feed prices could potentially reduce the profit margin for poultry growers and consequently a reduction in the quantity of poultry produced and a higher price for poultry meat at the retail level. Most of the recent corn price spikes in the U.S has been partly due to ethanol production which consumes about 30% of U.S corn. This paper deploys Nerlovian partial adjustment model for broiler, turkey and total poultry production in the U.S. The previous period’s corn feed price elasticity of demand is greater in the long-run compared to the short-run across broiler and total poultry production. Meanwhile, turkey production shows higher adjustment speeds but lower short and long-run corn feed price elasticity of demand.

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