Title

Procurement Risk Management in Beef Supply Chains

Publication Type

Book Chapter

Publication Date

2011

Abstract

This chapter develops the theoretical model and provides the optimal solution for the procurement portfolio of the packer. It describes the computational results for the above model based on data for the U.S. beef industry described in the GIPSA Report, and complemented by industry demand and supply studies. The chapter determines the impact on the optimal procurement portfolio of spot price and demand uncertainty, the degree of substitution between products in final markets, as well as the cost characteristics of the packer and the nature of quality and cost differences in the contract and spot markets. It provides insights about integrated risk management of input and output risks for the central player in the beef supply chains, the packer. The chapter also provides numerical simulations to illustrate the comparative statics of model results for processing, product market, and spot market parameters of interest.

Keywords

beef supply chains, contract markets, GIPSA Report, procurement risk management

Discipline

Operations and Supply Chain Management

Research Areas

Operations Management

Publication

The Handbook of Integrated Risk Management in Global Supply Chains

Editor

Kouvelis, Dong, Boyabatli, Li

First Page

463

Last Page

494

ISBN

9780470535127

Identifier

10.1002/9781118115800.ch17

Publisher

John Wiley & Sons

City or Country

New Jersey

Copyright Owner and License

John Wiley & Sons