Knight claims that there are other economically productive uses for byproducts; if thatâs true, then a reduction in demand for animal-derived pet food would change the marginal use case for byproducts but not reduce their production
I donât think ânot reduce their productionâ follows from your reasoning. If the next available use cases pay less money, we should, in espectation, see fewer animals raised, no?
I think youâre right in a theoretical marketplace: there is a demand signal here and we should expect production to decrease slightly.
I donât know that this stretches to the real marketplace. For one, it turns on how much less the next available use case is willing to pay, and historically it looks like the rendering industry has done well to find substitute uses (e.g., when synthetic soaps took off). I asked Perplexity, so fact-check this, but it suggests that slaughterhouses sell human-grade chicken for about $1.15 to $1.25 per lb, and theyâd lose about $0.02 per lb on their by-product profits (<2% of the profit margin from their main product) if they switched from selling to pet food manufacturers to selling to pork farmers.
For another, I think animals are lumpy good. Selling by-products does slightly increase the profit margin, but itâs a thin part of the overall profit margin, and I donât know if losing that valorisation stream really shifts the economics for the farmer.
Relatedly, you say
The âbyproductâ designation is convenient when distinguishing animal parts of different value, but at the end of the day, if youâre paying someone for animal parts, youâre paying them to slaughter animals
I definitely see your point, but I wonder if thereâs another sense where: biological waste is a ticking time bomb. It will smell and start to attract vermin and disease. From the slaughterhousesâ perspective, itâs amazing that somebody will pay to come in quickly and take that away. But the slaughterhouses would still swallow the cost, and probably not seriously consider killing fewer animals, if they had to dispose of that waste themselves.
By the way, Ben
I donât think ânot reduce their productionâ follows from your reasoning. If the next available use cases pay less money, we should, in espectation, see fewer animals raised, no?
I think youâre right in a theoretical marketplace: there is a demand signal here and we should expect production to decrease slightly.
I donât know that this stretches to the real marketplace. For one, it turns on how much less the next available use case is willing to pay, and historically it looks like the rendering industry has done well to find substitute uses (e.g., when synthetic soaps took off). I asked Perplexity, so fact-check this, but it suggests that slaughterhouses sell human-grade chicken for about $1.15 to $1.25 per lb, and theyâd lose about $0.02 per lb on their by-product profits (<2% of the profit margin from their main product) if they switched from selling to pet food manufacturers to selling to pork farmers.
For another, I think animals are lumpy good. Selling by-products does slightly increase the profit margin, but itâs a thin part of the overall profit margin, and I donât know if losing that valorisation stream really shifts the economics for the farmer.
Relatedly, you say
I definitely see your point, but I wonder if thereâs another sense where: biological waste is a ticking time bomb. It will smell and start to attract vermin and disease. From the slaughterhousesâ perspective, itâs amazing that somebody will pay to come in quickly and take that away. But the slaughterhouses would still swallow the cost, and probably not seriously consider killing fewer animals, if they had to dispose of that waste themselves.