Dynamic interfeed substitution: implications for incorporating ethanol byproducts into feedlot rations

Dong Hee Suh, Charles B. Moss

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

This study examines interfeed substitution with a focus on the relationship between distiller’s dried grain with solubles (DDGS) and traditional feed grains. The dynamic linear logit model is used for the empirical analysis of interfeed substitution. The estimation results reveal that an increase in livestock and poultry outputs reduces the relative shares of corn and soybean meal to DDGS. The estimated adjustment rate indicates that the demand for feed grains is responsive in the short run with about 37% of the long-run response. This study also finds that the demand for corn and soybean meal remains inelastic even in the long run, showing the possibilities that livestock and poultry producers face high feed costs in response to an increase in the prices of corn and soybean meal. The pressures on feed costs can be alleviated by the substitutable relationship between DDGS and corn, but the substitution of DDGS for corn has a potential to provide livestock and poultry with different nutritional contents.

Original languageEnglish
Pages (from-to)1893-1901
Number of pages9
JournalApplied Economics
Volume48
Issue number20
DOIs
Publication statusPublished - 2016 Apr 26
Externally publishedYes

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Keywords

  • corn
  • distiller’s grain
  • dynamic linear logit model
  • ethanol byproduct
  • Feed grain
  • soybean meal

ASJC Scopus subject areas

  • Economics and Econometrics

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