Price determinants of graded brisket

Abstract

Beef briskets were on average the lowest valued primal cut on a beef carcass for many years, but recently has been ranked as high as the the third most valuable cut on a carcass. The objective of this research is to determine factors that have impacted wholesale graded briskets prices. this study used a multivariate price determination model for Prime, Choice, Select, and Ungraded briskets using monthly data from 2004 to 2019. This study makes several unique contributions to literature, but the specific hypotheses are growing the introduction of a brisket in the quick service restaurant chain increased brisket prices. Also, we hypothesize that consumer interest is also increasing brisket prices. only Choice briskets were found to have a significant own-price flexibility (P<0.01) and cross-price flexibility  (P<0.01). That means when the supply of Choice brisket changes, the price of Choice and other graded briskets changed, which is expected since Choice briskets are the largest portion in the supply chain. Cross-quantity flexibilities showed substitutes across brisket quality grades and pork shoulders (P<0.05). The Google Trends variable revealed that as interest, defined as more internet searches, increased, the brisket prices increased over time (P<0.01). Finally, we found the impact of Arby's entrance into the brisket market had a positive impact on graded and ungraded briskets (P<0.01).