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International Synchronisation of the Pork Cycle

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  • Holst, Carsten
  • von Cramon-Taubadel, Stephan
Abstract
The development of pork prices has been analysed since the 1920s. Well known economic concepts such as Hanau’s pork cycle or Ezekiel’s cobweb theorem are based on the empirical analysis of pork markets. We analyze whether pork price developments in different countries have become more synchronised over time. In a first stage of our analysis, annual pork price data collected by the FAO reveals much heterogeneity of pork price developments across countries. However, for some groups of countries the observed price patterns are very similar or even identical. This is especially the case for neighbouring countries with integrated pork markets, such as the members of the European Union (EU). We then compare pork price developments in Germany and the USA based on 36 years of monthly producer prices for slaughter pigs. Since the middle of the 1990s cyclical pork price movements in the USA and Germany have become increasingly synchronous. We attribute this to two developments: the fact that the USA has become a large net exporter of pork over this period, and policy reform in the EU that has strengthened the link between international and EU feed prices.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Holst, Carsten & von Cramon-Taubadel, Stephan, 2011. "International Synchronisation of the Pork Cycle," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114532, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae11:114532
    DOI: 10.22004/ag.econ.114532
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    References listed on IDEAS

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    1. Harding, Don & Pagan, Adrian, 2006. "Synchronization of cycles," Journal of Econometrics, Elsevier, vol. 132(1), pages 59-79, May.
    2. Dermot J. Hayes & Andrew Schmitz, 1987. "Hog Cycles and Countercyclical Production Response," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(4), pages 762-770.
    3. Shonkwiler, John Scott & Spreen, Thomas H., 1986. "Statistical Significance And Stability Of The Hog Cycle," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 18(2), pages 1-7, December.
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    5. Arthur A. Harlow, 1960. "The Hog Cycle and the Cobweb Theorem," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 42(4), pages 842-853.
    6. Mordecai Ezekiel, 1938. "The Cobweb Theorem," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 52(2), pages 255-280.
    7. Kauermann Goeran & Krivobokova Tatyana & Semmler Willi, 2011. "Filtering Time Series with Penalized Splines," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 15(2), pages 1-28, March.
    8. Hovav Talpaz, 1974. "Multi-Frequency Cobweb Model: Decomposition of the Hog Cycle," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(1), pages 38-49.
    9. Matthew T. Holt & Lee A. Craig, 2006. "Nonlinear Dynamics and Structural Change in the U.S. Hog—Corn Cycle: A Time-Varying STAR Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(1), pages 215-233.
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    Cited by:

    1. Astrid Fliessbach & Rico Ihle, 2020. "Cycles in cattle and hog prices in South America," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(4), pages 1167-1183, October.
    2. Zaremba, Łukasz, 2018. "Cobweb theorem in relation to the fruit market," Roczniki (Annals), Polish Association of Agricultural Economists and Agribusiness - Stowarzyszenie Ekonomistow Rolnictwa e Agrobiznesu (SERiA), vol. 2018(3).

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