The Asymmetric Impact of International Feed Ingredient Prices on Swine Compound Feed Costs

This study aims to analyze the asymmetric price transmission mechanism of international feed ingredient prices on swine compound feed costs. The analysis differentiates between corn and soybean meal and breaks down the model into stages. Specifically, the study employs a nonlinear ARDL model to examine the impact of international feed ingredient prices on import prices, and subsequently, the impact of import prices on swine compound feed costs. The results are as follows. First, asymmetric price transmission was not observed when international feed ingredient prices influenced import prices. A comparison of feed ingredients revealed that, in the long term, the impact of international soybean meal prices on import prices is greater than that of international corn prices, which is attributed to differences in usage and import structures. Second, when import prices affect swine compound feed costs, corn import prices exhibit downward rigidity in both the short and long term, while soybean meal import prices show downward rigidity in the short term. Additionally, due to the higher proportion of corn in compound feed, the long-term impact of corn import prices on swine compound feed costs is more significant than that of soybean meal import prices. These findings underscore the necessity of monitoring international feed ingredient supply and prices to ensure a stable supply chain. Moreover, it is essential to establish preemptive support for feed ingredient reserves based on fluctuations in international prices. Finally, measures such as increasing the number of overseas grain elevators and reducing interest rates to alleviate cost burdens on feed companies in response to rising international feed ingredient prices should be considered.