The objectives of the article are twofold. First, a theoretical model that accounts for production and marketing lags is used to explain the pricing decisions of a firm that exports a processed good to two markets. The second objective is to measure Exchange Rate Pass-Through (ERPT) in pork meat export prices from three Canadian provinces (Ontario, Quebec, and Manitoba) to two destinations (United States and Japan) over the 1988–2003 period. The estimation results strongly support the hypothesis that predetermined supplies have a significant impact on export prices for two out
of three Canadian provinces. ERPT elasticity for Canadian exports to the United States is approximately in the range of −0.2 to −0.7. In the case of exports to Japan, the degree of misspecification involved with the standard ERPT
equation that only includes the Canadian dollar to yen exchange rate as well as a marginal cost proxy is quite large. The standard specification yields ERPT coefficients that are much smaller in absolute value than the ERPT coefficients found in the full system approach that includes predetermined hog supplies. Hence, failure to account for the dynamic nature of agricultural supply chains may result in significantly biased estimates of ERPT.