The competitive position of the Arizona egg industry

Published in 1975

Egg producers in Arizona have experienced a decline in market share and production capacity over the past five years. An increasing percentage of Arizona's demand for shell eggs is being supplied by California producers. This competitive advantage is attributed to cost advantages in California. A linear programming transportation model was formulated to determine how sensitive Arizona's competitive position was to changes in feed cost, transportation cost, and market demand. The objective was to project the volume and geographical location of egg production in Arizona in 1990 under the specified alternative conditions. It was determined that feed cost was the primary factor affecting the competitive advantage or disadvantage of Arizona egg producers. Increasing demand had only a slight influence on Arizona's egg producing regions while higher transportation costs had no affect at all. Decreasing Arizona feed costs by 7.8% from their 1974 level (approximately $11.00/ton) eliminated California production from the Arizona market. Only a concerted effort by Arizona producers to lower feed costs will make it possible for them to profitably expand their production.

AZU_TD_BOX287_E9791_1975_372.pdf (2.08 MB)

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