Vertical Structure and the Incidence of Cycle Exposure in Beef Production: Producer-Level Evidence from China

The cattle cycle is modeled as if producers were homogeneous, yet beef operations differ in vertical structure. Structure determines the incidence of cycle exposure, the sensitivity of profit to the finished price. In recorded profit, self-breeders are more exposed than feedlots: a one CNY per kilogram rise in the finished price raises their per-head profit by 117 CNY more. Valuing the internally produced calf at its market opportunity cost reverses the finishing-stage gap to –80 CNY per head: the difference lies upstream, where self-breeders hold the procyclical, amplified feeder-production margin. In the cycle observed, exposure is distributed by vertical structure.