Commodity Price Volatility: The Impact of Commodity Index Traders

index, traders, commodity, price, volatility, Agricultural and Food Policy, Demand and Price Analysis, Marketing,

The changing egg demand in Canada: do advertising and health message contents matter?

Agricultural and Food Policy, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy,

IMPACT OF DECISION MAKERS DIVERGENCE IN RISK ATTITUDES AND PERCEPTIONS ON CO-OPERATIVE MANAGEMENT IN CANADA

In this paper, the results of a survey investigating whether risk attitudes and perceptions differ between managers and boards of directors of co-operative agribusiness firms presented. Using the framework of Fishbein's attitude-behavior model the factors underlying these differences are identified. Implications for future strategies of co-operative agribusinesses management are addressed.Agribusiness, Risk and Uncertainty,

Do Decision Makers' Debt-risk Attitudes Affect the Agency Costs of Debt?

Over the past 25 years, traditional agricultural co-operatives have been challenged by competition from local investor-owned firms and multinational companies, deregulation and globalization of trade, and increased market concentration in suppliers and purchasers. At the same time, co-operatives have constantly been seeking to add value to their member services through expansion and/or adoption of new technology. The capital investment needed for these endeavours has to be financed, and for traditional co-operatives the major source of financing new investments has been long-term borrowing. As a result some co-operatives are characterized by high debt loads, which may result in increased financial risk exposure. Important factors that may influence the level of financial risk exposure are the potential conflicts between managerial self-interest and the interest of the owners of the firm (Jensen, 1986; Jensen and Meckling, 1976) and the impact of these differences on the choice of capital structure (Friend and Lang, 1988; Firth, 1995; Matthews et al., 1994). Despite the considerable literature (e.g., Jensen and Meckling, 1976; Lewis and Sappington, 1995), the impact that differences in attitudes between managers and directors/members have upon the decision making process has remained a relatively unexplained aspect of agency problems, especially in member-owned firms. This article assesses the social-psychological and demographic variables that affect co-operative decision makers’ attitudes toward long-term debt financing and their intentions to increase long-term borrowing.Agribusiness, Agricultural and Food Policy,

Commodity Price Volatility: The Impact of Commodity Index Traders

Over the years, critics have argued that futures market prices have been either too low or too high. Speculators have often been the target for the wrath of those feeling the futures price does not properly reflect market fundamentals. Recently, the criticism has been vented toward a new type of speculator that has been blamed for the dramatic changes in agricultural commodity prices experienced over the last several years. Commodity index traders (CITs) and other large institutional traders are commonly accused of exerting a destabilizing influence on commodity prices. The intensity of the debate over the role of CITs appeared to wane with the reduction in commodity prices since 2008 but the recent release of a well-publicized OECD report on the issue by Irwin and Sanders (2010) along with the doubling of wheat prices and the claim by von Braun (2010) and others that the rise was due to speculative activity has renewed the debate.commodity, index futures, trading, volatility, Agribusiness, Agricultural and Food Policy, Demand and Price Analysis, Marketing,

INCENTIVE INCOMPATIBILITY IN CO-OPERATIVE AGRIBUSINESS FIRMS IN CANADA: DOES SUPPLY MANAGEMENT MATTER?

Agribusiness,

The Effects of Relative Price and Health Information on Derived Demand for Sweeteners in the U.S. Food Processing Industry

The purpose of the study is to examine the differential effects of relative prices and diet-health link information on the degree of substitution between corn and cane sugar in the U.S. food processing sector. Our results suggest that the nature of the relationship between cane and corn sugar is complementary and time-varying; and the elasticity of substitution is more responsive to changes in relative prices than to changes in health information.Derived Demand, Sweeteners, Relative Prices, Health Information, Trade offs, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, D21, I18, L66,

Measuring Efficiency in Fruit and Vegetable Marketing Co-operatives with Heterogeneous Technologies in Canada

The objectives of this study are to estimate the efficiency of fruit and vegetable co-operatives in Canada and to investigate the relationship between the degree of financial leverage and efficiency.Agribusiness,

The Phenomena Implied by the New Economy from Statistics Perspective

The rapidity of the informational society to transform into an information and knowledge society determines a perspective on the New Economy which would consider the Internet market and the effect of the Internet information on all economic agents, and the effect of knowledge as economic factor, which imposes the recognition of intangible goods, in general, in the making of economic value as well as the requirements for achieving a lasting society, which cannot be possible but inside the knowledge society, and which would impose in the society economy new technologies, and most important, changes in orientation according to the classic economic thinking

More Reasons Why Farmers Have So Little Interest in Futures Markets

The use by farmers of futures contracts and other hedging instruments has been observed to be low in many situations, and this has sometimes seemed to be considered surprising or even mysterious. We propose that it is, in fact, readily understandable and consistent with rational decision making. Standard models of the decision about optimal hedging show that it is negatively related to basis risk, to quantity risk, and to transaction costs. Farmers who have less uncertainty about prices have a lower optimal level of hedging. If a farmer has optimistic price expectations relative to the futures market, the incentive to hedge can be greatly reduced. And finally, farmers who have low levels of risk aversion have little to gain from hedging in terms of risk reduction, in that the certainty equivalent payoff at their optimal hedge may be little different to the certainty equivalent under zero hedging. These reasons are additional to the argument of Simmons (2002) who showed that, if capital markets are efficient, farmers can manage their risk exposure through adjusting their leverage, obviating the need for hedging instruments.hedging, risk, risk aversion, flat payoff functions, Agricultural Finance,