Master of Agribusiness / Department of Agricultural Economics / Jeffery R. Williams / The economic feasibility of adding a pistachio roasting facility to the current operations of Tularosa Pistachio Groves (TG) was examined. A facility that roasts and processes 200,000 pounds of pistachio nuts was found to be the most economically viable for the available product grown by (TG) and other small growers in this area. This size facility optimizes the production capacity of the equipment needed for a small grower/processor and fully utilizes a fulltime skilled labor pool needed for the operation. Lower production levels utilize the same equipment on an intermittent schedule. Although operating costs are less when processing fewer pistachio nuts, the negative cash flows during the early period of the project are significant and make the lower production levels less financially viable. The primary reason the lower production quantities are less attractive is because the initial capital investment produced lower cash incomes in the early years of operation. Additional cash is needed for the operation costs, and principal and interest payments. Achieving maximum production to utilize the capacity of the facility sooner makes the project more financially feasible.

Master of Agribusiness / Department of Agricultural Economics / Ted C. Schroeder / Annual vaccination of the beef cow herd is a common management tool for most beef herd operations. However, no studies have established the minimal vaccination frequency needed to attain an acceptable herd production output with minimal financial inputs. The hypothesis of this study stated that the production output and profitability of the cow herd would not be decreased by vaccinating the cow herd at intervals of greater than one year. An animal's immune response to a vaccine or a direct challenge by a pathogen requires it to partition nutritional resources from other functioning biological systems within the body such as reproduction and lactation. According to the concept of diminishing returns, there is a point at which the cost of inputs (labor costs, vaccine costs and frequency of vaccination) does not result in corresponding levels of production output (measured by calf weaning weight, cow pregnancy rate and calf survivability). Thus, the objective of this thesis was to evaluate the effect of varying the interval of vaccination on cow reproductive productivity, calf productivity at weaning and herd profitability. It is important to note that this research study does not question the premises of vaccinating a cow herd or the effectiveness of the vaccines, but only investigates the time interval between vaccinations. This study consisted of approximately 1000 head of beef cattle divided between two ranch locations in south central South Dakota. Permanent and yearly production records were collected for each individual cow and calf for three production years 1998, 1999 and 2000. At each location cows were randomly assigned into four treatment groups:1) Group V0 – control or non-vaccinated, 2) Group V1 – vaccinated in 2000, 3) Group V2 – vaccinated in 1999 and 2000 and 4) Group V3 – vaccinated in 1998, 1999 and 2000. At the conclusion of this four year study, varying the interval of vaccinations did not decrease the production and the profitability of the treatment groups compared to the control group in the weaning weight and calf mortality models. However, in the pregnancy model conception rates were significantly reduced in 2 of the 3 treatment groups.

Master of Agribusiness / Department of Agricultural Economics / Brian P. Niehoff / The purpose of this thesis was to provide recommendations for improving the existing Farm Credit of the Virginia's, ACA (FCV) "Training of Today’s/Tomorrow's Association Leaders" (TOTAL) leadership development program. In the wake of pending retirements and increased competition for experienced and talented leaders, FCV has developed the TOTAL leadership development program. TOTAL is a competency based program designed to enhance the interpersonal skills of high potential leaders. An extensive literature review was performed to identify leadership development best practices. The best practices identified were as follows: having an organizational culture of leadership development, leaders developing leaders, 360-degree feedback, coaching and mentoring, and job assignments and action learning. An analysis of the existing TOTAL program yielded the identification of strengths, opportunities, and challenges. Finally, recommendations for improving the effectiveness of TOTAL were provided.

Master of Agribusiness / Department of Agricultural Economics / Michael D. Tokach / Lone Tree Farms, Inc. is a diversified agricultural enterprise located in Harrisonville, Missouri. Since operations began in 1962, the hog operation has been expanded to the present size of a 2500 sow farrow-to-wean operation. The results of the thesis research lead Lone Tree Farms believes that there are economic and efficiency reasons behind adding to the existing farrow-to-wean operation with a 2500 sow farrow-to-wean operation. The thesis confirms and reveals several points. First, the project takes between 9 months and a year to complete. Some of the inputs required are eight more personnel and an additional 90,000 bushel of feed grain per operating year. Approximately 3,000 gilts are utilized to stock the project and building costs of approximately $3.5 million dollars will be accrued. The total costs of developing the project will be approximately $4.25 to 4.5 million dollars before the first pig is sold (2007 US Dollars). Many risk factors affect the outcome of the project, including risk of high grain prices due to ethanol, labor needs, environmental issues, and manure utilization needs of the project. The spreadsheet model that was developed as part of this thesis reveals that low productivity of the sow herd is the greatest risk factor for the success of the project. Reducing pigs weaned per sow from 11.0 to 8.5 would lower projected return on equity from 32.7. to 7.6% and increase the cost to produce a weaned pig by $8.72/pig. A major change in both corn (over $2.50/bu) and soybean meal (over $200/ton) price would be required for feed cost to have a similar impact on the cost to produce a weaned pig. The start-up and initial production year pose the greatest challenges and risks. After that, production flows should reach more consistency and effectively lower the risk. The initial start-up capitalization of approximately 30% reduces exposure and liquidity risks. The timing of the project should be made when both input expenses and output prices (pig price) are able to be managed. Combined with good management which maximizes pigs/sow weaned, the project stands a very good chance of being considered successful.

Master of Agribusiness / Department of Agricultural Economics / Vincent R. Amanor-Boadu / The Kansas Wheat Commission and the Kansas Association of Wheat Growers offer a number of services to Kansas wheat producers. Kansas wheat producers will be willing to pay more if they perceive they are getting more value from the Kansas wheat organizations. However, Kansas wheat producers are unaware of what the Kansas wheat organizations are doing on their behalf. It is believed that if Kansas wheat producers were more aware of what their organizations were doing on their behalf, they would be willing to contribute more. The overall objective is to improve Kansas wheat producer knowledge of Kansas Wheat activities. A survey of Kansas wheat producers provided data about willingness to pay, importance of services, channel preferences and producer demographics. Funds provided by the Kansas wheat assessment are used for a number of projects and programs. Current programs can be categorized into four areas: research; education, communications, and meetings supporting Kansas wheat growers; domestic market development; and international market development. When asked to rank those four areas from highest to lowest priority, respondents overwhelmingly chose research as the highest priority investment of the Kansas wheat assessment. The survey results indicated that Kansas wheat producers were willing to pay an amount above the current level of 10 mills per bushel for the Kansas wheat assessment. The mean response was 12.42 mills. Members of the Kansas Association of Wheat Growers were willing to pay more for the assessment (15.13 mills per bushel) than non-members. In general, radio is the preferred channel of Kansas wheat producers; however, the two most listed publications and radio stations they rely on for information about wheat were High Plains Journal (33%) and Kansas Farmer (30%), both industry publications. Other producer demographics such as location in the state, type of producer, and acreage also affect producers' willingness to pay.

Master of Science / Department of Agricultural Economics / Ted C. Schroeder / Value-added management at the cow-calf level is integrated across breeding, health and nutrition programs. Hedonic pricing models are necessary to navigate through the layered management standards imposed by certified health and marketing programs on the cow-calf sector. Previous research in feeder calf pricing models provides insight on the use and development of ordinary least squares in estimating price effects. Breed, vaccination program, age-and-source verification and natural-beef production have become more relevant as vertical coordination has influenced commercial cow-calf producers. This study provides the industry with new information pertaining to the revenue opportunities that exist for cow-calf producers through increased coordination in the beef industry. Video and satellite auction markets are recognized as a national pricing mechanism for feeder cattle in the United States. These markets represent the management and marketing practices of national cow-calf producers and the tastes and preferences of a national stocker and feedlot industry. Previous research in feeder cattle pricing models is applied to the current genetic, management, marketing and market structure information from video auction markets to discover relevant price effects pertaining to value-added calf production. More intensive value-added management practices were expected to enhance the revenue of cow-calf producers selling their calves through video auction markets. This research confirms that verified health and genetic claims produce higher calf prices compared to commodity calves. Weaned calves with at least two rounds of respiratory vaccinations generated an additional $5.50 to $7.50 per cwt., and weaning created $2.75 to $4.50 per cwt. in premiums over non-certified health programs. There were statistical differences among the premiums for each aggregated breed influence, and Angus and black and black-white faced cattle offered the highest breed premiums at $5.25 to $7.50 per cwt. compared to Brahman-influenced calves. Age-and-source verification presents the best opportunity for video auction market premiums among recently developed marketing programs. Statistically significant premiums ranged from $1.25 to $2.00 per cwt. for both steers and heifers over the last five years.

Master of Science / Department of Agricultural Economics / John A. Fox / The concept of animal cloning was first introduced to the public’s attention in 1996 with the birth of “Dolly the Sheep,” the first mammal to be cloned. Now, after more than a decade the technology has reached a point of feasibility on a commercial scale. With the publication of the U.S. Food and Drug Administration risk assessment on animal cloning in 2008, a report that concluded that the technology was safe and posed no risk to consumers, the issue has received renewed attention. In this thesis I use survey data to examine attitudes to the use of cloning in animal food production among samples of college students in the U.S., Ireland, France, Honduras, and China. Stated likelihood of consuming meat products from cloned animals is correlated with individual characteristics including socio-demographic variables (gender, and farming background) and attitudinal variables measuring concern about various food technologies. In addition, using ordered logit modeling, we examine how respondents might change their probability of consuming cloned products after being provided with information about scientific assessments about the safety of cloning and possible price reductions for cloned products. The analysis shows that: a) respondents in the U.S. and Honduras were more likely than those in other countries to indicate that they would consume cloned products, b) on average, respondents in all countries increased their stated likelihood of consuming cloned products when informed that the U.S. Food and Drug Administration and the European Food Safety Authority had assessed cloned foods as safe for human consumption, and c) individuals who were opposed to cloning on moral grounds were significantly less likely to consume cloned product and furthermore were less likely to respond positively to information about the safety of cloning.

Doctor of Philosophy / Department of Agricultural Economics / Vincent Amanor-Boadu / Allen M. Featherstone / Estimation of cost functions can provide useful economic information to producers, economists, and policy makers. From the estimation of a cost function, it is possible to calculate cost efficiency, economies of scope, and economies of scale. Economic theory specifies the cost function as a frontier since firms cannot operate at lower cost than the cost minimizing input/output bundle. However, traditional parametric estimation techniques often violate economic theory using two sided-error systems. The stochastic frontier method has allowed the estimation of a frontier but continues to restrict the technology through functional assumption. Nonparametric frontier estimation is an alternative approach to estimate a cost frontier by enveloping the data which by its construct, conforms to economic theory. This research expands the economic information available by deriving multi-product scale economies and product-specific scale economies from the nonparametric approach. It also tests its ability to accurately recover these important economic measures under different assumptions of the cost function, and cost inefficiency distributions. Next, this new method is compared to other methods used to estimate cost functions and associated economic measures including a two-sided error system, stochastic frontier method, and an OLS model restricting the errors to take on only positive values. Finally, the nonparametric approach with the new measures is applied to a sample of Kansas farms. The nonparametric approach is able to closely estimate economies of scale and scope from estimation of a cost frontier. Comparison reveals that the nonparametric approach is closer to the “true” economic measures than some parametric methods and that it is better able to extrapolate out of sample when there are no zero output firms. Finally, the nonparametric approach shows that potential cost savings from economies of scale and economies of scope exist for small Kansas farms. However, cost savings from economies of scale become exhausted when farms exceed gross annual revenues of $500k, while economies of scope also diminish as farms grow larger. Results also show from annual frontier estimations that estimates of economies of scale, scope, and cost efficiency have remained relatively stable from 2002 to 2011.

Master of Agribusiness / Agricultural Economics / Allen M. Featherstone / The purpose of this thesis is to analyze whether the use of automated aeration systems for reducing moisture in corn during storage provides sufficient net present value for Nebraska corn farmers. The objective is to examine if an automated aeration system provides sufficient energy savings, marketing opportunities and reduced drying costs before corn delivery to an elevator. On-the-farm corn storage has steadily increased and harvesting corn before the moisture has achieved the desired targets cost farmers in drying charges and shrink. Farmers are interested in whether automated aeration systems can remove enough moisture from grain, without over-drying the bin, without spending a large amount of time determining when to run their grain bin aeration fans. Data for this project were obtained from four privately owned 60,000 bushel grain bins outfitted with the IntelliAir™ BinManager™ automated aeration system. Moisture samples were taken from each of the trucks hauling grain to the bin and again after removal of the corn after the automated system had ran for 9 months. Energy usage, drying charges, and shrink were calculated for the initial corn moisture averages and the moisture at the time of removal. Each bin was examined using Net Present Value (NPV) analysis to determine whether the energy savings were enough to offset the initial installation cost and annual expenses of the project. After the NPV was estimated for each of the bins, a sensitivity analysis of how corn price changes and no aeration required would affect the NPV analysis. Finally, an analysis of the total costs savings of a continuously ran aeration system was compared to the automated aeration system. The conclusion of the NPV analysis was that adding an automated aeration system would be profitable under most scenarios. More studies are needed to determine the profitability of automated aeration systems in different regions, moisture inputs, and bin sizes.

Master of Agribusiness / Agricultural Economics / Vincent R. Amanor-Boadu / The rapidly changing economic environment in the Democratic Republic of Congo (DR Congo) offers significant opportunities for businesses. The food and agribusiness sector is one of the major opportunities for growth given that increasing incomes are going to enhance the food and nutrition security needs of an increasing segment of the population. Animal protein in the form of chicken meat and eggs are relatively inexpensive and offer an opportunity for entry and differentiation in a markets located in DR Congo’s largest cities of Kinshasa and Kananga. This thesis uses the case of Z-CO Farm in DR Congo to explore the strategic opportunities for small-scale egg production in a low-income but growing country. Having been in operation for a number of years, Z-CO Farms has been producing chicken eggs for the general consumer market. This thesis explores the opportunity to differentiate the market that Z-CO Farms targets with the view to enhance its competitiveness, expand the market boundaries and create new value for customers that produce significant rewards. The off-take for the project is the creation of Blue Ocean markets for chicken eggs in a market that is increasingly exposed to food safety risks by assuring consumers a safe product. This project, when implemented, would be the first in DR Congo. However, would it be profitable? Under what conditions would it be profitable? We employ three primary methods to answer the foregoing questions. First, we evaluate the literature and the available secondary data. Second, we use an economic and financial model to develop the foundation for conducting the analyses for assessing the feasibility of building a small-scale table egg production system to address the emerging higher income consumers in DR Congo. We draw on the blue ocean strategy eloquently presented by Kim and Mauborgne for insight and guidance in building a unique product and service offering for the identified markets in Kinshasa and Kananga. We assess four strategies: the base scenario of the current market conditions where Z-CO maintains its commodity red ocean engagement in the market; innovating its feeding program for the birds; pursuing a market segmentation program whereby it offers high value food safety value proposition to the middle and upper-middle class of consumers; and a combination of a feed innovation and market segmentation initiative. The results show that while the first two strategies returned a positive net present value (NPV) in Kananga, they failed in Kinshasa. This is because of the level of competition in Kinshasa compared to Kananga as well as the cost of operations in the two locations. The results also show that while the remaining two strategies were profitable in both markets, they offered higher NPV and internal rates of return in Kananga than in Kinshasa. The best outcome in operating in both cities involved the fourth strategy, producing a combined NPV of about $493,867. The principal driver for this superior performance in Kananga is cost of feed. There is, therefore, value in thinking about how to leverage this cost advantage in Kananga to enhance the profitability in Kinshasa because of the population and income advantage in the latter. The study provides insights for the management of Z-CO to pursue their future investment planning and in selecting the locations and size of their operations to maximize their NPV and IRR. It also identifies the principal sources of risks that Z-CO’s management must avoid or effectively manage to achieve their desired business outcomes.