The use of simulation in evaluating international competitiveness in broiler production

Abstract

With the ongoing U.S.-Canada Free Trade Agreement and the recently approved North American Free Trade Agreement, there is a need to evaluate the competitiveness of Canadian broiler farms with U.S. broiler farms under the free trade environment. This study uses a comprehensive, farm-level, capital budgeting, Monte Carlo simulation model, CHICKSIM III, to analyze the production and financial performance of representative broiler farms for both countries under various free trade scenarios. Results show how differences in industry and cost structures of the broiler industry in both countries affect the ability of the Canadian broiler growers to compete with U.S. farms in an unrestricted market environment.