Market events have significantly impacted the European meat industry over the past few decades, potentially altering the underlying dynamics and interrelationships of price movements. Notably, the pig market has experienced drastic changes, primarily due to disease outbreaks and a significant increase in production costs. This study examines both cointegration (CI) and partial cointegration (PCI) between Hungary and major European pig markets from 2010 to 2023. Cointegration (CI) refers to the long-run equilibrium of prices, whereas partial cointegration (PCI) represents a less restrictive framework that allows the cointegrating relationship to be decomposed into a mean-reverting component and a stochastic random walk component. Our findings indicated time-varying price co-movement with Germany, the Netherlands, and Austria, which gradually weakened in the second half of the sample period. The price relationship between Hungary and Germany has changed significantly, with evidence of cointegration disappearing in the second half of the sample period. Standard tests for Austria similarly indicated no evidence of linear cointegration. Instead, a statistically and economically significant PCI relationship appears to have developed. These results imply that important price relationships may have diminished or that their nature has shifted. The findings indicate that price relationships in the European pig market are much more complex than previously assumed, and their time-varying nature amplifies price-related risks for market participants.
Crises and Competitiveness: Analysing the European Wine Trade Response to Economic Shocks
In recent years, the European wine industry has faced rising global competition, changing consumer preferences, and repeated economic crises. This...
