Author : Balanay, Raquel M.

Summary : The study analyzed the price volatility and supply response of Philippine poultry through live broiler, dressed chicken, chicken eggs and duck eggs. ARCH was used to estimate the expected price and price volatilities, which formed part of the ordinary least squares (OLS) with error correction for the supply response analysis. To test the presence of heat wave and shower effects as impacts of price volatility, ARCH with error correction was applied. Results showed that poultry in the Philippines is a strong industry with increasing demand and nominal prices. Significant price volatility found in poultry indicated that price risk is considerable in the industry, which can affect negatively the supply responses of live broiler and eggs. Production timing and feedback mechanisms were the common factors of poultry's supply response. Significant results of heat wave and meteor shower effects implied that substantial price uncertainty in poultry can affect other markets. Improving information service, poultry breeds, market coordination, hedging and commodity market research using advanced GARCH models were recommended to address price volatility and its impacts.