The effect of local livestock population changes on auction market viability—a spatial analysis

Abstract

This paper examines the relationship between auction market closures over the period 1980–2000 and livestock population changes, as recorded in the agricultural and horticultural census. Auction market locations and census data were collated within a Geographical Information System and changes in livestock populations examined by region and by market catchment. Regionally, auction market closures during the 1980s were significantly associated with concurrent reductions in cattle numbers, with market reductions following loss of cattle in eastern lowland areas. No such association with livestock numbers was found during the 1990s. Within these agricultural regions, individual market closures were not associated with changes in local livestock numbers within their catchments. Thus, the historical evidence suggests that whilst a substantial loss of livestock within a region puts pressure on its network of auction markets, the viability of individual markets within the region is decided by other factors. Such factors include the capital costs of modernising market facilities and meeting new regulatory requirements, the effect of unpaid debt on market cashflow, and the market's ability to diversify into other areas of business. The recent outbreak of foot and mouth disease may lead to further market closures, both directly as a result of livestock culls and indirectly as farmers continue to use alternative marketing channels developed when auction markets were closed during the outbreak.