Economics 235 Summary l Food marketing challenges – Distribution to consumers – Returns to farmers l Marketing channel – Participants – Functions – Communication

l Definition of markets – Organize and facilitate business l Define a specific market – Form, place, time, possession l Market function – Create utility

l Consumers – Demographics – Consumption trends l Demand – Originates with consumer utility – Drivers of demand

l Supply – Derived from cost curves – Shifters – Long-run v. short run l Elasticities – Own, cross, income

l Law of one price – Arbitrage l Price discovery – Systems – Issues – Price reporting

l Retailing and wholesaling – Relative size – Types of retailing – Trends

l Issues of competition – Degree (perfect, monopoly, oligopoly, monopolistic competition) – Factors determining – Implications – Measures and examples

l Vertical coordination – Traditional methods – Trends l Integration – Ownership – Contract

l Contract integration – Motivation – Trends – Examples – Importance – Implications

l Cooperatives – Definition – Requirements – Functions – Importance – Problems

l Futures market – Logistics – Participants – Basis – Hedging with futures – Forward contract

l Options on futures – Types – Positions – Logistics – Advantages / disadvantages

l Situation and outlook – Motivation – Time horizon – Flexibilities v elasticities – Forecasting

l Market controversies – Futures market concerns – Mis-use of tools – Captive supplies – Packer contracts

l Government farm policy – Level of intervention – Tools – History / trend – Implication of recent changes

l Agricultural trade – Importance and trends – Trade policy / trade-offs – Comparative advantage – Trade debate – Agreements

l Role of Government – Market regulation and competition – Safety and inspection – Economic and social progress

l Grades and standards – Motivation – Private v public – Examples – Trends