scholarly journals Volatility and Co‑movement: an Analysis of Food Commodity Prices in Nigeria

2017 ◽  
Vol 50 (3) ◽  
pp. 129-139
Author(s):  
Omotoso Oluseye Ogunmola ◽  
Abiodun Elijah Obayelu ◽  
Sakiru Oladele Akinbode
Keyword(s):  
Commodity Prices ◽  
Price Volatility ◽  
Food Prices ◽  
Food Price ◽  
Food Distribution ◽  
Series Data ◽  
Price Series ◽  
Short Period ◽  
High Volatility ◽  
Food Commodity

AbstractThis study explains volatility as a measure and interaction of the possible movement in a particular economic variable. Prices change rapidly in adjustment to market circumstances. Food prices hike experienced overyears has resulted in widespread menace which led to increase in food price volatility. However, volatility and co-movement had generally been lower for the past two decades than for the previous ones. Wide price movements over a short period of time connote high volatility, rendering the producers and consumers vulnerable. Excess volatility can be subjected to sector ineffectiveness and is commodity specific. Producers and processors are mostly concerned about increased price volatility, which greatly exposed them to unpredictable risks and uncertainty associated with price changes. This study examined the volatility and co-movement of food commodity prices in Nigeria using price series data on rice, maize, sorghum, cassava and yam for the period of 1966 to 2013. The data were analysed using Vector Autoregressive Model to forecast food price volatility and to examine the food commodity prices that Granger cause food price volatility in other food commodities. The GARCH regression model is used to estimate the magnitude of volatility which revealed that, food commodity prices exhibit high volatility and there is persistent increase in prices over the period of study. The Nigerian food commodity prices have experienced high fluctuations over the period; therefore, the study recommends proper storage facilities and infrastructure for the food distribution corporations in Nigeria.

Book Reviews

2015 ◽  
Vol 53 (2) ◽  
pp. 377-378
Keyword(s):  
Social Protection ◽  
Commodity Prices ◽  
Price Volatility ◽  
Commodity Price ◽  
Food Prices ◽  
Food Price ◽  
Agricultural Commodity ◽  
Vector Autoregressive ◽  
Jean Paul ◽  
The University

Finn Tarp of UNU-WIDER and University of Copenhagen reviews “The Economics of Food Price Volatility”, by Jean-Paul Chavas, David Hummels, and Brian D. Wright. The Econlit abstract of this book begins: “Nine papers, plus nine comments, present and assess recent research on central issues related to recent food price volatility. Papers discuss influences of agricultural technology on the size and importance of food price variability; corn production shocks in 2012 and beyond─implications for harvest volatility; biofuels, binding constraints, and agricultural commodity price volatility; the evolving relationships between agricultural and energy commodity prices─a shifting-mean vector autoregressive analysis; the question of bubble troubles─rational storage, mean reversion, and runs in commodity prices; bubbles, food prices, and speculation─evidence from the Commodity Futures Trading Commission's daily large trader data files; food price volatility and domestic stabilization policies in developing countries; food price spikes, price insulation, and poverty; and trade insulation as social protection.” Chavas is Anderson-Bascom Professor of Agricultural and Applied Economics at the University of Wisconsin-Madison. Hummels is Professor of Economics in the Krannert School of Management at Purdue University. Wright is Professor of Agricultural and Resource Economics at the University of California at Berkeley.

scholarly journals Links between food price behaviour and nutrition in the developing world

SURG Journal ◽  
2012 ◽  
Vol 5 (2) ◽  
pp. 51-62
Author(s):  
Bethany Woods
Keyword(s):  
Food Security ◽  
Commodity Prices ◽  
Price Volatility ◽  
Commodity Markets ◽  
Unintended Consequences ◽  
Food Price ◽  
Price Increases ◽  
The Impact ◽  
Food Commodity ◽  
Global Food

With the recent financial crisis and its enduring fallout, questions surrounding the state of global food security have become more pressing. A key element influencing the nutritional status of the world’s poor is price behavior within global food commodity markets. In recent decades, food commodity markets have experienced both significant price increases, and an increase in volatility. These price trends have had significant impacts on the diversity of diets in impoverished households worldwide, which in turn has impacted nutrition and health. This paper will discuss the causes behind recent trends in food commodity prices, and the extent of their impact on food security and nutrition. Specifically, it will address the impact of food price increases and the uncertainty induced by food price volatility on household food consumption and nutrition. Micronutrient intake is the focus of the nutritional discussion of this work, and variations of consumption behavior in various regions and within different household dynamics are all taken into account. Existing policy actions are discussed in terms of the frequency of their implementation, the factors encouraging or deterring their implementation, and their intended and unintended consequences. Finally, the paper concludes with suggestions for future actions and areas for future research.

scholarly journals The Nature of Food Commodity Prices Volatility in Driving Inflation and Policy

2017 ◽  
Vol 6 (1) ◽  
pp. 103-124
Author(s):  
Nurliza Nurliza
Keyword(s):  
Time Series Data ◽  
Commodity Prices ◽  
Series Data ◽  
Asymmetric Effect ◽  
Exogenous Shock ◽  
High Volatility ◽  
Effect Of Food ◽  
The Government ◽  
Food Commodity ◽  
Food Inflation

The objective of research is to analyze the volatility effect of food commodity prices and whether surging food commodity prices have spilled over into food inflation and total inflation with time series data through Box-Jenkins method for 12 food commodity prices. The results have proved that only beef price had high volatility effects and have asymmetric effect. While, soybeans, cooking oil, and food are vulnerable but did not have volatility effects. The change in food commodity prices are significant drive the inflation in the long-term although in the short-term insignificant. The government needs to overcome the full transmission effect of an exogenous shock and to introduce economic reform through investment, infrastructure, and markets for corn and egg for food inflation; eggs and peanuts for total inflation. Besides, strong second-round effects of higher commodity prices on inflation have generally been absent converged to core inflation.DOI:  10.15408/sjie.v6i1.4523

scholarly journals Commodity Food Prices: Review and Empirics

2013 ◽  
Vol 2013 ◽  
pp. 1-15 ◽  
Author(s):  
Anthony N. Rezitis ◽  
Maria Sassi
Keyword(s):  
Literature Review ◽  
Structural Breaks ◽  
Price Index ◽  
Commodity Prices ◽  
Food Prices ◽  
Food Price ◽  
Agricultural Commodity ◽  
Structural Trend ◽  
Empirical Results ◽  
Price Series

The present paper provides a literature review of studies examining the potential causes and consequences of recent surges in food and agricultural commodity prices. Furthermore, this paper uses the structural trend methodology proposed by Koopman et al. (2009) to analyze movements in the IMF monthly commodity food price index for the period 1992(11)–2012(10) and to provide forecasts for the period 2012(11)–2014(12). The empirical results indicate that commodity food prices present seasonality and cyclicality with the longest periodicity of two years. The empirical findings identify certain structural breaks in commodity food price series as well as outliers. These structural breaks seem to capture the trend component of the price series well, while the outliers take account of temporal effects, that is, short-lived spikes. Finally, the presented forecasts show high and volatile commodity food prices.

scholarly journals THE IMPACT OF THE WORLD FOOD PRICE INDEX ON SOME EAST-EUROPEAN ECONOMIES

2018 ◽  
Vol 19 (2) ◽  
pp. 268-287
Author(s):  
Corina Saman ◽  
Cecilia Alexandri
Keyword(s):  
Price Volatility ◽  
Agricultural Trade ◽  
Food Prices ◽  
Food Price ◽  
Long Run ◽  
Short Run ◽  
Positive Shock ◽  
Macroeconomic Implications ◽  
The Impact ◽  
Global Food

This paper deals with the dynamic response of exchange rates, inflation and agricultural foreign trade in Bulgaria, Poland and Romania to global food prices. We employ time-varying VARs with stochastic volatility to estimate the behaviour of these macroeconomic variables over the 2001M1–2015M12 period. The original contribution of this paper is that it captures the time variation and nonlinearities of the relationship between variables taking into account food price volatility and its macroeconomic implications. The main findings of the paper are: (i) high global food prices were transmitted to domestic economies causing pressure on inflation in the long run; (ii) in the short run the impact of a positive shock in international food price increases domestic inflation, depreci-ates the currency and reduces the agricultural trade; (iii) the vulnerabilities to global food prices are more pregnant for Romania and Bulgaria; (iv) the difference in the transmission of world prices is related to the different status of the countries as regards food and agricultural trade. The findings of the research would be significant for the governments to promote policies to help farmers respond to the rising of food prices by growing more and responding to export opportunities that may arise.

Understanding causes of volatility in onion prices in India

2019 ◽  
Vol 9 (3) ◽  
pp. 255-275 ◽  
Author(s):  
Pratap Birthal ◽  
Akanksha Negi ◽  
P.K. Joshi
Keyword(s):  
Supply Chain ◽  
Market Power ◽  
Time Series Data ◽  
Price Volatility ◽  
Food Prices ◽  
Control Measures ◽  
Series Data ◽  
High Price ◽  
Content Type ◽  
Food Commodities

Purpose Post-2008 global food crisis the prices of perishable high-value food commodities, such as vegetables and fruits, in India have risen faster and become more volatile compared to that of cereals. The welfare consequences of price shocks though are well understood yet the policy responses to manage these remain blurred because of a lack of clarity on their causes. Focusing on onions that comprise an important constituent of the Indian diet, the purpose of this paper is to explore causes of high price volatility. Design/methodology/approach Using high-frequency time series data on wholesale prices and arrivals of onions in major markets and other relevant variables, this paper analyzes causes of price volatility from several angles, that is production shocks, seasonality in production and market arrivals, internal trade, export policies and market power of intermediaries on the supply chain. Findings Despite markets being integrated and no significant climatic shocks to production there exists a strong element of uncertainty in market arrivals of onions, pointing toward the market power immediate downstream the production or alternatively anti-competition trade practices in major markets as a cause of high price volatility. The measures to manage price volatility, such as an increase in minimum export prices and bans on exports, are also not found to have an immediate cooling effect on prices. Research limitations/implications The agricultural policy should provide for a system of market intelligence to monitor anti-competitive trade practices along the supply chain, and to take proactive trade control measures to prevent frequent ups and downs in domestic prices. In addition, it should provide for incentives for developing efficient supply chains and for the cultivation of onions in the regions that have agronomic potential but it has remained underexploited due to one or the other constraint. Social implications Excessive volatility in food prices impacts farmers, consumers, processors, and traders and even political system. It may distort production and investment decisions of farmers and intermediaries on the value chains, leading to inefficient allocation of resources. The poor consumers may be forced to reduce food and non-food productive expenditures. If persists for a longer period, it may lead to political instability too. Originality/value Several studies have analyzed volatility in food prices and causes thereof. However, rarely any of these has examined volatility in prices of perishable high-value food commodities. This paper is an attempt toward filling this gap.

Food price volatility and socio-inequalities in household food insecurity during coronavirus disease-2019 lockdown in Nansana municipality, Wakiso district Uganda

2020 ◽  
Author(s):  
Edward Buzigi ◽  
Stephen Onakuse
Keyword(s):  
Food Insecurity ◽  
Virus Disease ◽  
Multivariate Logistic Regression Analysis ◽  
Price Volatility ◽  
Food Prices ◽  
Food Price ◽  
Food Aid ◽  
Household Food Insecurity ◽  
Staple Food ◽  
Household Food

Abstract BackgroundThis study assessed staple food price volatility, food consumption scores (FCS) and prevalence of household food insecurity (HHFI) and its socio-inequalities during enforcing and lifting corona virus disease -2019 (COVID-19) lockdown in Nansana municipality, Uganda.MethodsA repeated households (HHs) based cross-sectional study was conducted in urban Nansana Municipality, Uganda. A total of 405 HHs (205 slum and 200 non-slum) were selected using stratified random sampling. Data on social demographics and FCS in the previous 7 days were collected using questionnaire-based telephone interviews with HH heads. Prices for staple foods was collected by asking food sellers from local markets. Mean staple food price differences between before COVID-19 lockdown and during enforcing or lifting the lockdown was tested by paired t test. A binary outcome of HHFI (FCS of 0-35) and food secure (FCS>35) HHs was created. The association between exposure variables and HHFI was tested using multivariate logistic regression analysis at a probability value of 5%.ResultsMean price of staple food significantly increased between before and during enforcing the COVID-19 lockdown (p <0.0001). Mean FCS during COVID-19 lockdown were at borderline for either slum (22.8) or non-slum (22.9) HHs, and were not significantly different from each other (p=0.06). During partial lifting of the lockdown, FCS among slum HHs were significantly lower at 20.1 (poor) compared to non-slum HHs at 22.7 (borderline) (p=0.01). The mean FCS was significantly higher at borderline (24.5) among HHs that received food aid compared to poor FCS (18.2) among slum HHs that did not receive food aid (p<0.0001). The prevalence of HHFI was high and not significantly different (p>0.05) between slum (94.6%) and non-slum (93.5%) HHs during COVID-19 lockdown. HHFI was higher in slum (98.5%) than non-slum (94%) HHs (p<0.05) on partial lifting of the lockdown. Adjusted odds ratio (AOR) showed that being a wage earner and employed HH head was positively (AOR: 8.3, 95% CI: 1.9-36.2) and negatively (AOR: 0.07, CI: 0.02-0.2) associated with HHFI, respectively. During partial lifting of COVID-19 lockdown, slum HHs (AOR: 11.8, 95% CI: 1.5-91.3), female headed HHs (AOR: 11.9, 95%CI: 1.5-92.7), wage earners (AOR: 10.7, 95% CI: 1.4-82.9) and tenants (AOR: 4.0, 95% CI: 1.1- 14.7) were positively associated with HHFI. Conclusion Staple food prices increased during enforcing COVID-19 lockdown compared before lockdown. Food aid distribution during COVID-19 lockdown improved FCS among slum HHs, however, it did not prevent against slum HHFI.

scholarly journals Does Oil Price Drive World Food Prices? Evidence from Linear and Nonlinear ARDL Modeling

Economies ◽  
2019 ◽  
Vol 7 (1) ◽  
pp. 12 ◽  
Author(s):  
Mourad Zmami ◽  
Ousama Ben-Salha
Keyword(s):  
Commodity Prices ◽  
Food Prices ◽  
Food Price ◽  
Oil Price ◽  
Agricultural Commodity ◽  
Distributed Lag ◽  
Nonlinear Ardl ◽  
Long Run ◽  
Linear And Nonlinear ◽  
The Impact

The macroeconomic outcomes of oil price fluctuations have been at the forefront of the debate among economists, financial analysts and policymakers over the last decades. Among others, the oil price–food price nexus has particularly received a great deal of attention. While an abundant body of literature has focused on the linear relationship between oil price and food price, little is known regarding the nonlinear interactions between them. The aim of this paper is to conduct aggregated and disaggregated analyses of the impact of the Brent and West Texas Intermediate (WTI) oil prices on international food prices between January 1990 and October 2017. The empirical investigation is based on the estimation of linear and nonlinear autoregressive distributed lag (ARDL) models. The findings confirm the presence of asymmetries since the overall food price is only affected by positive shocks on oil price in the long-run. While the dairy price index reacts to both positive and negative changes of oil price, the impact of oil price increases is found to be greater. Finally, the asymmetry is present for some other agricultural commodity prices in the short-run, since they respond only to oil price decreases. All in all, the study concludes that studies assuming the presence of a symmetric impact of oil price on food price might be flawed. The findings are important for the undertaking of future studies and the design of international and national policies in the fight against food insecurity.

scholarly journals The Transmission of Global Commodity Prices to Consumer Prices in a Commodity Import-Dependent Country: Evidence from Morocco

2020 ◽  
Vol 67 (1) ◽  
pp. 15-32
Author(s):  
Mounir El-Karimi ◽  
El-Ghini Ahmed
Keyword(s):  
Commodity Prices ◽  
Oil Prices ◽  
Commodity Price ◽  
Food Prices ◽  
Food Price ◽  
Oil Price ◽  
Causality Test ◽  
Consumer Prices ◽  
Short Run ◽  
The Impact

This paper uses the Breitung and Candelon (2006) causality test to examine the effect of global oil and food price changes on the inflation in Morocco over the period from 1998Q1 to 2018Q1. The results show significant transmission from oil and food prices to domestic inflation. Specifically, the food prices are shown more important than oil prices in explaining inflation in the short-run, which reflects the high weight of food in the consumption basket. However, the effect of oil prices on inflation is much more persistent than the effect of food prices. Furthermore, the impact of commodity price shocks on inflation exhibits asymmetries. The oil price hikes affect more weakly the inflation than oil price decreases, whereas the food price increases are more transmitted to inflation than food price decreases. Our findings may provide useful information to researchers and policymakers in formulating more appropriate monetary policy.

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