To Law of Supply and Demand
Broilers Seemingly Fail to Respond
V.
(Continued from page five)
the average price received by
verse relationship of marketings [ farmers for 'broilers is at its
and prices, the chart shows that | highest level for the year m the
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Denver
summer.
Why this paradox’ Do not the
forces of supply and demand
hold equally well for broilers as
for hogs?
Certainly, but price equates
supply and demand. The season
al changes in the price of a
product reflect the month-to
month changes in both supply
and demand If month-to-month
variations in the supply of a com
modity are greater than month
to-month variations in the de-
Ph. EL 4-8721
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r~^r
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jfe
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mand for it, monthly average
prices will dip while marketings
increase.
HOWEVER, IF MONTH-to
month variations m demand are
greater than month-to month var
iations in supply, monthly aver
age prices will rise with market
ings The former case appears to
describe the seasonal pattern of
the hog prices, while the latter
case appears to be a more suit
1 1
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Lancaster Farming, Friday, July 25, 1958—9
able explanation" for broilex'
prices.
Ex-penence seems (o sho./
monthly changes m demand for
pork are small. Demand declines
somewhat in the hot month-,.
However, marketings of hogs de
crease so greatly in late summer
that prices are at their high
point for the year, despite little
apparent change m demand.
FOR BROILERS, WARM wea
ther probably means an increased
demand People want easily pre
pared, less fatty foods in tbe
heat of summer; a smaller sup
ply of red meat also boosts de
mand for broilers declines sharply
at Thanksgiving time when tur
keys become the favorite source
of poultry.
It is quite important for the
poultry producer to have some
idea of the seasonal demand and
prices for a product if he is to
plan production and marketings
wisely.
If a broiler producer considered
only seasonal changes m supply,
he would feel that large supplies
in the summer would mean lov/
prices, and therefore he would
reduce placements of chicks for
summe rmarketings.
By ignoring the summer seas
onal increase in broiler demand,
the producer would have reduced
the number of broileis available
for selling at a time when prices
are at their peak for the year.
However, if the seasonal vari
ation in broiler marketings in
creased as sharply as for hogs,
the seasonal swings in demand
would be offset so that the
onal swing in price would prob
ably level out.
Lloyd M.
BURKHOLDER
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60 jears of farm service.
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Ph. ELgin 4-8001