Great Plains Studies, Center for


Date of this Version

Spring 2006


Published in Great Plains Research 16:1 (Spring 2006). Copyright © 2006 The Center for Great Plains Studies, University of Nebraska – Lincoln. Used by permission.


Coproducts of processing agricultural commodities are often marketed for use as livestock feed through private transaction. The resulting lack of historical price information prohibits the use of positive time series techniques to estimate demand. Linear programming is used as a normative technique to estimate step function demand schedules for coproducts by individual livestock classes. Seemingly unrelated regression is used to smooth demand schedules by fitting demand data to generalized Leontief cost functions. Estimates are adjusted for data censoring using probit analysis. Aggregate quantity demanded of sugarbeet pulp, wheat middlings, and potato waste is relatively responsive to price changes (i.e., demand is elastic) but less so for specific species and at higher prices for sugarbeet pulp (i.e., demand is inelastic) .