Farm share and price spread in Australia's beef supply chain

Overview \r\n This study uses a case study approach to demonstrate the potential to estimate farm shares and price spreads in Australia using a relatively simple methodology developed by the United States Department of Agriculture Economic Research Service. In this instance, the methodology has been applied to Australian beef price data. \r\n\r\n Key Points \r\n• The study demonstrates that data is available that allows an analysis of farm share and price spread for beef sold at domestic retail outlets and to export markets. \r\n• The analysis shows that trends in farm share of the retail price and the farm-to-retail price spread were relatively flat between 1970-71 and 2015-16. It also shows that trends in farm share of the export price and the farm-to-export price spread were flat between 1996-97 and 2015-16. \r\n• If it is assumed that the emergence of market power beyond the farm gate is likely to be reflected in a sustained widening in price spread or a sustained decline in farm share, then these results suggest that there has been no obvious change in market power within the beef industry over the this period. \r\n