China's Competitive Threat to Latin America: An Analysis for 1990-2002

This paper explores China's competitive threat to Latin America in trade in manufactures. The direct threat in exports to third country markets appears small: LAC's trade structure is largely complementary to that of China. In bilateral trade, several LAC countries are increasing primary and resource-based exports to China. However, the pattern of trade, with LAC specializing increasingly in resource-based products and China in manufactures, seems worrying. Given cumulative capability building, China's success in increasingly technology-based products with strong learning externalities can place it on a higher growth path than specialisation in 'simpler' goods, as in LAC. China may thus affect LAC's technological upgrading in exports and industrial production. The issue is not so much current competition as the 'spaces' open for LAC in the emerging technology-based world.

Commodity Dynamics: A Sparse Multi-class Approach

The correct understanding of commodity price dynamics can bring relevant improvements in terms of policy formulation both for developing and developed countries. Agricultural, metal and energy commodity prices might depend on each other: although we expect few important effects among the total number of possible ones, some price effects among different commodities might still be substantial. Moreover, the increasing integration of the world economy suggests that these effects should be comparable for different markets. This paper introduces a sparse estimator of the Multi-class Vector AutoRegressive model to detect common price effects between a large number of commodities, for different markets or investment portfolios. In a first application, we consider agricultural, metal and energy commodities for three different markets. We show a large prevalence of effects involving metal commodities in the Chinese and Indian markets, and the existence of asymmetric price effects. In a second application, we analyze commodity prices for five different investment portfolios, and highlight the existence of important effects from energy to agricultural commodities. The relevance of biofuels is hereby confirmed. Overall, we find stronger similarities in commodity price effects among portfolios than among markets

A Brief Energy Outlook for the XXI Century

The price of oil has surged five-fold since 2003. A variety of factors are used to explain this: turbulence in the Middle East and rising demand in emerging economies such as India and China are the most common ones. In fact, the latest World Economic Outlook (WEO) from the International Monetary Fund (IMF) has declared that the Chinese and Indian economies “account for more than 90 per cent of the rise in consumption of oil products and metals, and 80 per cent of the rise in consumption of grains since 2002.” On Thursday, June 26, 2008, the price of oil broke the all time high of $140 per barrel. The Organization of Petroleum Exporting Countries (Opec) predicted that this summer the price of oil will range between$150-170 per barrel. This extraordinarily high price has a detrimental impact on an already fragile world economy, forcing governments to work desperately to find alternatives to help reduce the high energy bill for their economies and people. According to some experts, one of the most efficient alternatives is bio-ethanol obtained from corn and sugar cane. However, the production of bio-ethanol raises two concerns: One is a trade-off between arable land to grow food or to grow the source for bio-ethanol. The second has to do with the ecological damage associate with growing sugar-cane. However, Brazil proves these two concerns wrong. Brazil has the most successful bio-ethanol program in the world and has obtained its energy independence at no high environmental or food production cost. Brazil’s success story is closely followed by the EU, US, UK, and even China. Furthermore, there are other energy alternatives such as nuclear energy, which in France covers 75% of the national electricity demand. Additionally, there are others sources of energy like the sun, the wind, and the sea that provide free (beyond the generating equipment) and abundant energy, but which require government investment in terms of start-up subsidies to develop them. Unfortunately, despite the exorbitant current price of oil and the inspiring example of Brazil, governments continue to look for new petroleum resources, rather than new energy alternatives. For example, Cuba recently announced that is has new oil reserves twenty miles north of Havana, and European companies have been the first ones to bid for exploration rights. Lately, Florida Governor Crist has announced that he might change its policy regarding oil exploration off the Florida Cost. This demonstrates that governments still are not fully aware of the great risk globally as a result of the dependency on oil. It seems that a situation similar to that causing “The Great Smog of 1952” in London would have to occur for governments to take the search for new energy sources seriously.Oil, Price of crude,

Taro leaf and stylo forage as protein sources for pigs in Laos

Existing forage plants may have applications as alternative protein resources for pigs in smallholder farming systems. This thesis examined the effect of harvesting/defoliation interval on the yield and chemical composition of taro leaves and stylo forage and analysed appropriate ensiling methods for these materials. The effect of replacing soybean crude protein (CP) with ensiled taro leaf and stylo forage CP on growth performance and carcass traits of LY (Landrace x Yorkshire) and ML (Moo Lath) pigs was also examined. Taro leaf and petiole dry matter (DM) yield increased with increased harvesting frequency in the two years studied, but there was no effect on tuber yield. The leaves contained 160-260 g CP kg¹ DM. Stylo leaf DM yield was unaffected by harvesting interval in the first year, while leaf DM yield was larger with the most frequent harvesting in the second year. The leaves contained 170-235 g CP kg¹ DM, which was much higher than in the stems or forage (leaves+stems). Use of cassava root meal, sugar cane molasses and taro tuber meal as silage additives affected pH and the DM, ash and NDF content of stylo forage and taro leaf silage, and the NH₃-N content of stylo forage silage. Level of additive affected pH and DM, NH₃-N, CP, ash and NDF content in taro silage, but not NH₃-N, CP and NDF content in stylo forage silage. Increasing duration of ensiling reduced pH and DM content in stylo forage and taro leaf silage. Dry matter intake (DMI) and CP intake (CPI) in growing LY and ML pigs were unaffected by increasing replacement (25 and 50%) of soybean CP by taro leaf silage CP in the diet, whilst for stylo forage silage DMI and CPI were highest when 25% of soybean CP was replaced. Average daily weight gain and feed conversion ratio (FCR), carcass weight, back fat thickness and dressing percentage were unaffected by increasing replacement of soybean CP with taro leaf or stylo forage CP in the diet. LY pigs had higher intake and better carcass traits than ML pigs. The work confirmed that stylo forage and taro leaves can be used as protein sources in smallholder pig production systems without negative effects on the performance of growing LY and ML pigs

The Dynamics of Energy-Grain Prices with Open Interest

This paper examines the short- and long-run daily relationships for a grain-energy nexus that includes the prices of corn, crude oil, ethanol, gasoline, soybeans, and sugar, and their open interest. The empirical results demonstrate the presence of these relationships in this nexus, and underscore the importance of ethanol and soybeans in all these relationships. In particular, ethanol and be considered as a catalyst in this nexus because of its significance as a loading factor, a long-run error corrector and a short-run adjuster. Ethanol leads all commodities in the price discovery process in the long run. The negative cross-price open interest effects suggest that there is a money outflow from all commodities in response to increases in open interest positions in the corn futures markets, indicating that active arbitrage activity takes place in those markets. On the other hand, an increase in the soybean open interest contributes to fund inflows in the corn futures market and the other futures markets, leading to more speculative activities in these markets. In connection with open interest, the ethanol market fails because of its thin market. Finally, it is interesting to note that the long-run equilibrium (cointegrating relationship), speeds of adjustment and open interest across markets have strengthened significantly during the 2009-2011 economic recovery period, compared with the full and 2007-2009 Great Recession periods.Energy-grain price nexus; open interest; futures prices; ethanol; crude oil; gasoline; corn; soybean; sugar; arbitrage; speculation

The Dynamics of Energy-Grain Prices with Open Interest

This paper examines the short- and long-run daily relationships for a grain-energy nexus that includes the prices of corn, crude oil, ethanol, gasoline, soybeans, and sugar, and their open interest. The empirical results demonstrate the presence of these relationships in this nexus, and underscore the importance of ethanol and soybeans in all these relationships. In particular, ethanol and be considered as a catalyst in this nexus because of its significance as a loading factor, a long-run error corrector and a short-run adjuster. Ethanol leads all commodities in the price discovery process in the long run. The negative cross-price open interest effects suggest that there is a money outflow from all commodities in response to increases in open interest positions in the corn futures markets, indicating that active arbitrage activity takes place in those markets. On the other hand, an increase in the soybean open interest contributes to fund inflows in the corn futures market and the other futures markets, leading to more speculative activities in these markets. In connection with open interest, the ethanol market fails because of its thin market. Finally, it is interesting to note that the long-run equilibrium (cointegrating relationship), speeds of adjustment and open interest across markets have strengthened significantly during the 2009-2011 economic recovery period, compared with the full and 2007-2009 Great Recession periods.

The Global Bioenergy Expansion: How Large Are the Food−Fuel Trade-Offs?

We summarize a large set of recent simulations and policy analyses based on FAPRI’s world multimarket, partial-equilibrium models. We first quantify and project the emergence of biofuel markets in US and world agriculture for the coming decade. Then, we perturb the models with incremental shocks in US and world ethanol consumption in deviation from this projected emergence to assess their effects on world agricultural and food markets. Various food-biofuel trade-offs are quantified and examined. Increases in food prices are moderate for the US ethanol expansion and even smaller for the ethanol expansion outside the United States, which is based on sugarcane feedstock, which has little feedback on other markets. With the US expansion, the high protection in the US ethanol market limits potential adjustments in the world ethanol markets and increases the demand for feedstock within the United States. Changes in US grain and oilseed market prices propagate to world markets, as the United States is a large exporter in these markets. With changes in world prices, land allocation in the rest of the world responds to the new relative prices as in the United States but with smaller magnitudes because price transmission to local markets is less than full.ethanol; biofuel; land effects; food prices; trade-offs

The Dynamics of Energy-Grain Prices with Open Interest

This paper examines the short- and long-run daily relationships for a grain-energy nexus that includes the prices of corn, crude oil, ethanol, gasoline, soybeans, and sugar, and their open interest. The empirical results demonstrate the presence of these relationships in this nexus, and underscore the importance of ethanol and soybeans in all these relationships. In particular, ethanol and be considered as a catalyst in this nexus because of its significance as a loading factor, a long-run error corrector and a short-run adjuster. Ethanol leads all commodities in the price discovery process in the long run. The negative cross-price open interest effects suggest that there is a money outflow from all commodities in response to increases in open interest positions in the corn futures markets, indicating that active arbitrage activity takes place in those markets. On the other hand, an increase in the soybean open interest contributes to fund inflows in the corn futures market and the other futures markets, leading to more speculative activities in these markets. In connection with open interest, the ethanol market fails because of its thin market. Finally, it is interesting to note that the long-run equilibrium (cointegrating relationship), speeds of adjustment and open interest across markets have strengthened significantly during the 2009-2011 economic recovery period, compared with the full and 2007-2009 Great Recession periods.Energy-grain price nexus, open interest, futures prices, ethanol, crude oil, gasoline, corn, soybean, sugar, arbitrage, speculation.

China's Long-Term International Trade Statistics: By Commodity, 1952-1964 and 1981-2000

International trade has been a key engine driving Chinese economic growth in recent decades. Yet, long-term analyses of China's trade are still difficult because the country's trade statistics for the post-war period up to the mid-1980s have many shortcomings For example, official customs statistics published by the Chinese government during this period, if they were published at all, do not provide any breakdown by commodity classification. Against this background, we recently compiled new statistics of China's trade during 1952-1964 and 1981-2000 at the 3-digit level of the Standard International Trade Classification, Revision 1 (SITC-R1). The statistics for 1952-1964 and 1981-1987 are based on data we purchased from China's National Statistical Bureau. The data for 1988-2000 are compiled from the Commodity Trade Statistics of the United Nations (UN Comtrade) as a part of our joint work with scholars at the Institute of Development Economies, Japan External Trade Organization (IDE-JETRO). In this paper, we provide an overview of existing statistics of China's international trade and present our newly compiled statistics.