Price expectations of sheep and goats by producers and intermediaries in Quetta market, Pakistan

Abstract

Analysis of producers' and intermediaries' livestock price expectations was used to describe the market in Quetta, the largest livestock market in the highlands of Balochistan Province, Pakistan, and to identify factors that determine price expectations of small ruminants. A total of 4800 expected prices for sheep and goats were collected from producers and market intermediaries at monthly intervals between January 1991 and December 1992. In addition to the expected price of the animal, liveweight, species, sex, breed, body condition (fatness), calendar day and month were recorded, and whether data were collected on a meat or meatless day. Monthly rainfall data were also collected. Models of goat and sheep price expectations were built to compare the similarity of the behaviour of producers and intermediaries. Results indicated that producers and intermediaries expected high prices from November to January and during religious holidays. They expected premiums and discounts related to animals' attributes. Liveweight and seasonality had the strongest effect on prices. Rainfall in the current and previous month was positively related to seller's expected prices suggesting that livestock are retained to take advantage of favourable grazing conditions. The models of price expectations showed that producers adjusted expected goat prices (P ~ 0.10) for seasonality, liveweight, body condition, age, sex and breed, while they adjusted sheep prices for seasonality and liveweight only. High pay-offs could be expected if extension efforts focused on factors that determine sheep meat quality; however, the retail ceiling price of meat and the lack of grading are a disincentive to work in this direction. Seasonality of supply and demand is important in determining prices and this study provides baseline information for market scheduling; however, scheduling of sales of transhumant pastoralists may be difficult to achieve. Further investigation is justified to understand the gap in marketing knowledge between producers who sell in the villages and those who sell in Quetta. Livestock production and marketing constraints have been identified as the major factors that limit animal offtake in the highlands of Balochistan Province, Pakistan (Nagy et al., 1991).

Hedonic Analysis of Price Expectations of Goat Producers in Afghanistan: Implications for Production and Marketing Decisions

“…With one unit increase in the live weight of goat, expected price decreased by Afs 15 per kg. Rodriguez et al, () also reported findings similar to our results that per kg live weight was negatively related to the expected prices. This is true because in the survey data, per kg price expectation for a goat weighing 7 kg was Afs 286 and for a goat weighing 42 kg, it was Afs 167.…”

“…The price agreed by producers and buyers depends on their knowledge of market supply and demand, coupled with their skills in assessing animal condition (and weight) as goats are not weighed before purchase (Bett et al, ); and their market information including their knowledge of different attributes of goats preferred by different buyers (Francis, ). Market price information generally in livestock markets in developing economies is mainly limited to personal interactions between market agents due to poor market intelligence systems (Rodriguez et al, ). In a conflict‐affected country like Afghanistan, one cannot expect to have an effective market intelligence system.…”

“…This technique of hedonic pricing has been previously applied to investigate factors affecting selling prices of small ruminants in Nigeria (Francis, ; Jabbar, ), in Pakistan (Rodriguez et al, ), in Philippines (Orden et al ., ), and in Ethiopia (Andargachew & Brokken, ; Ayele et al, ). Turner & Williams () examined the factors influencing prices received by livestock producers at the level of primary markets in rural villages and found that price formation is socially biased by gender, wealth, and location, reflecting differential access and powers within local markets.…”

Does Breed Matter to Cattle Farmers and Buyers? Evidence from West Africa

“…Brorsen et al, 1984;Francis, 1990;Andargachew and Brokken, 1993;Parker, 1993;Parker and Zilberman, 1993;Williams et al, 1993;Oczkowski, 1994;Rodriguez et al, 1995). 10 The general form of the implicit price function may be written as P = F(Q,C) + e where P is the observed price of the product, Q is a set of qualitative (discrete) variables or factors each with more than one category, C is a set of quantitative variables (covariates), and e is an error term.…”

Incorporating artificial intelligence in microsimulation

“…This means that only products are differentiated, while the markets, buyers and sellers are not. In most empirical studies, however, linear regression models have been used with product as well as market and market agent attributes as variables implying the existence of elements of non-competitiveness in the relevant product market being investigated (Brorsen et al 1984;Francis, 1990;Andargachew and Brokken, 1993;Parker, 1993;Parker and Zilberman, 1993;Williams et al 1993;Oczkowski, 1994;Rodriguez et al 1995). While the hedonic method has been criticised for its assumptions, its inability to capture off-site benefits and difficulty in isolating marginal changes, it none the less provides a valuable tool for valuing certain types of environmental improvement and degradation (Halstead et al 1997).…”