SORGHUM GRAIN DEMAND IN MEXICO WITH THE TECHNIQUE OF DISTRIBUTED DELAYS

Abstract

Sorghum (Sorghum vulgare Pers) is one of the most important grains for the Mexican livestock industry, it is the second largest basic grain and is considered the main ingredient in the production of balanced nourishment. In order to estimate the determining factors of grain sorghum demand in Mexico, a multi-variable linear econometric model for the 1995-2014 period was estimated using the distributed delays technique. The results displayed that sorghum demand responds inelastically to changes in price, with price elasticities of 0.35 and 0.42 in the short and long term, while an increase in the price of maize causes the demand for sorghum to increase by 0.39 and 0.47, which makes it a substitute and inelastic good for grain consumption. Unit percentage increases in beef cattle and milk population would increase sorghum demand by 0.60 and 0.51. The adjustment rate between the current consumption and the desired grain consumption was 0.85, it is a quick adjustment, so the market does not overreact to changes in prices, and it is stable and controlled in the short term. Is possible to conclude that demand for sorghum in Mexico is more influenced by the increase of beef and milk cattle as well as poultry.