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This paper develops a model of the European Community compound feed sector capable of explaining demand for feed ingredients, and the output demand and prices for compound feeds. The adopted framework rests upon the use of duality theory to represent the optimising production decisions of compound feed firms. In addition, an appropriate methodology is suggested to capture the rapid expansion in the consumption of compound feeds in the European Community and their adoption by livestock producers. The model is then applied to the French compound‐feed sector using annual time‐series data stretching over the period 1962–1980.
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