Branding, as a means of product differentiation, is a practice of long standing in the food industry. Historically, food manufacturers have used brands as a means of gaining a larger share of the market while avoiding the consequences of direct price competition. Merchandising food, particularly dairy products, under private label brands, however, is a practice of more recent origin.

Introduction of private label brands of dairy products can be traced to that period of the 1920s when private label brands of evaporated milk first appeared in some markets. This was followed by private label brands of butter in the 1930s and fluid milk and ice cream during the 1950s.

Producer “checkoff” programs have been established for several agricultural commodities. Typically, at least part of the money collected is used to support commodity promotions. But decisions about support of promotions often are made with little information about expected impacts on demand. Studies of selected commodity promotions have provided estimates of promotions' impacts on intercepts of demand functions. But these studies have not provided information about impacts on other demand parameters; viz., the responsiveness of quantity demanded to changes in commodity price, prices of competing commodities or consumer income. The purpose of this paper is to suggest and illustrate a research procedure that provides estimates of a promotion's impacts on the demand function's intercept and on responsiveness of quantity demanded to changes in price, competing prices and income.

Previous analysis on annual wholesale marketing margins for cottonseed has indicated a need to establish the structure of short-period time lags between prices for cottonseed products and resulting farm prices for the gin-run seed. In particular, this would help assess large wholesale margins since the beginning of the 1972 crop year, when cottonseed oil and meal prices began an inflationary surge that has resulted in increases of over 100 percent.

Objectives of this paper are: (1) to formulate and estimate the monthly, distribution of lagged response of cottonseed prices to changes in wholesale cottonseed product prices in the United States and (2) to use the estimation results in examining recent behavior of cottonseed prices and wholesale marketing margins.

Marketing agreements and orders have been used for several decades by various commodity groups in an effort to stabilize and increase the level of farm income. These programs are tools to be used in a “self-help” fashion. They do not automatically solve an industry's marketing problems. For instance, if an industry has continuous interseasonal supply control difficulties, a marketing agreement may actually aggravate the problem it was intended to solve. However, intraseasonal volume controls can relieve short-run imbalances in supply while not adversely affecting consumers. Merging long-run and short-run perspectives is the problem that creates difficulty in program evaluation.

Changing conditions in market organization and competitive nature of the United States dairy industry are signaling a different pricing system for milk and related products. Market conditions and demand patterns which led to adoption of the present pricing system no longer exist. The reservoir of manufacturing grade milk in Minnesota and Wisconsin is continually being depleted, as producers in that area either leave the business or shift to Grade “A” fluid outlets.

A changing demand for milk and other dairy products has also contributed to the present need for a reconsideration of the milk pricing process. Per capita consumption of beverage milk has stabilized at about 292 pounds per year. There have been, however, substantial increases in the consumption rate for some manufactured products, especially cheese. Ironically, with somewhat stabilized increases in population growth, future expansion for the dairy industry may rest with the potential for increased consumption of those products traditionally serving as “residual claimants”.