Tag: price transmission

Compared to most of the agricultural commodity markets in the European Union (EU), the pig market is less regulated and EU pig prices can be regarded as free market prices. It is thus an ideal economic research opportunity to investigate agricultural market integration and spatial price transmission mechanisms in the EU in the different Member States (MS). Depending on the geographical location, the decoupling of production costs from prices paid to pig farmers can jeopardise the fragile market balance between producers and processors. To retrospectively identify price setting trends, this paper examines how price return trends in the Hungarian pig sector are reflected in dynamic Diebold–Yilmaz spillover indices between 2007 and 2021. The results show that Hungary was mostly a net spillover receiver throughout the investigated period. Pairwise comparison of price spillovers to and from other MSs indicated that the German pig market had the strongest effect on the price forecast error variance in the Hungarian market, but transient interaction with other MS markets was also detected. To obtain a detailed time domain representation of the multivariate relationship between different MS’s price returns, our method considers an improved partial wavelet coherence (pwc) approach, which – to our knowledge – has ...

This paper investigates the symmetry of impact from three main food scare events on both the upstream and downstream price transmissions in the Chinese pork market through monthly data from 2001 to 2014. Based on a theoretical model, we firstly estimate the VAR systems for pork retail price and price transmissions in different links, and then plot the impulse response function and dynamic multiplier function respectively for endogenous substitute good price and exogenous food scare events. Empirical results indicate the asymmetry of price transmission in the Chinese pork market, and demand and supply shocks from three food scare incidents are found to impact retail price and price transmissions differentially. In addition, shocks from the same incident on price and price transmissions are significantly different. This research provides implications for farmers, business managers and policy makers to make strategies in response to food scare events.

Our study determines the competitive positions of the dairy sectors of Hungary and the other European Union (EU) Member States in the light of the abolition of the milk quota. We analyse the recent market positions of the EU Member States, the changes in the relationships between global, EU and Hungarian milk procurement prices, and the medium-term forecasts for the international markets for milk and milk products, including the results of our own model. In most Member States, milk production is below the quota level, although the most competitive countries are paying substantial penalties for excess production. The medium-term projections and the price relationships underline the fact that, due to the liberalisation of the milk market and the rapid rise in global demand, the impacts of global market developments in the EU will be further enhanced. Owing to sustained international demand, the EU’s export opportunities will improve, reducing the pressure on the internal market, and this will have a spill over effect on Hungarian milk prices. Although in terms of trade balance and quota utilisation Hungary is one of the least competitive Member States, the concentration, modernisation and selection processes that have taken place in the country’s dairy sector in ...