NPR - A PRODUCE PRICE ANALYSIS OF REGIONAL OHIO VALLEY PRODUCE AUCTIONS

Abstract:

Produce auctions in the Ohio River Valley play an important role in the marketing of produce in the region. While smaller than urban-based terminal markets, these agriculture commodity aggregation points serve both local and regional buyers, providing access to wholesale markets otherwise too distant for smaller scale farmers in the area. Similar auctions have continued to start or expand throughout the Mid-South. The prices, quality, and quantity of the products distributed through these auctions vary throughout the marketing season and, subsequently, different kinds of buyers are attracted to bid. This study examines the evidence for structural market differences between early season, when prices are systematically higher, and peak season that can arise from different buyer needs relating to volume and distribution in local versus more regional outlets. Price and quantity records from two of the larger Kentucky auctions, the Fairview and Lincoln County Produce Auction are analyzed for seven different produce commodities during early and peak season. Four years of data are evaluated using structural difference regression equations to test for early versus peak temporal differences as well as specific auction effects. This information can assist produce auctions to establish market coordination with season extension and variously scaled market buyers.

Keywords: produce auction, local produce, wholesale, marketing