146 research outputs found
Vertical Market Structure, Commodity Exports and Trade Reform
In the analysis of commodity markets, comparatively little attention is paid to the fact that commodity exports are intermediates that form inputs into the food processing and retail sectors in developed countries. Exporting countries correspondingly argue that access to developed country markets are determined by market structure characteristics of the downstream food sector. Given the vertical nature of these markets, they are most appropriately characterised by successive oligopoly and/or oligopsony. We explore trade policy issues facing commodity exporters, and show that the impact of tariff reform on commodity exporters is determined by the market structure characteristics of the downstream sectors.vertical market structure, trade reform, Industrial Organization, International Relations/Trade, F12, Q17,
ANALYZING VERTICAL MARKET STRUCTURE AND ITS IMPLICATIONS FOR TRADE LIBERALIZATION AND MARKET ACCESS
International Relations/Trade,
Buyer power in U.K. food retailing: a 'first-pass' test
Habtu Weldegebriel, University of Warwick
Abstract
The potential existence of buyer power in U.K. food retailing has attracted the scrutiny of the U.K.'s anti-trust authorities, culminating in the second of two comprehensive regulatory inquiries in recent years. Such inquiries are authoritative but correspondingly time-consuming and costly. Moreover, detection of buyer power has been dogged by the paucity of reliable evidence of its existence. In this paper, we present a simple theoretical model of oligopsony which delivers quasi-reduced form retailer-producer pricing equations with which the null of perfect competition can be tested using readily available market data. Using a cointegrated vector autoregression, we find empirical results that show the null of perfect competition can be rejected in seven of the nine food products investigated. Though not conclusive on the existence of buyer power, the proposed test offers a means via which the behaviour of the retail-producer price spread is consistent with it. At the very least, it can corroborate the concerns of the anti-trust authorities as to whether buyer power is potentially one source of concern
Market Power in UK Food Retailing: Theory and Evidence from Seven Product Groups
Establishing the presence of market power in food chains has become an increasingly pertinent line of enquiry given the trend towards increasing concentration that has been observed in many parts of the world. This paper presents a theoretical model of price transmission in vertically related markets under imperfect competition. The model delivers a quasi-reduced form representation that is empirically tractable using readily available market data to test for the presence of market power. In particular, we show that the hypothesis of perfect competition can be rejected if shocks to the demand and supply function are significant and correctly signed in price transmission equations. Using a cointegrated vector autoregression, we find empirical results that are consistent with downstream market power in six out of seven food products investigated, supporting both the findings of the UK competition authority's recent investigation in to supermarkets and renewed calls for further scrutiny of supermarket behaviour by the UK's Office of Trading.imperfect competition, Cointegrated VARs, UK food industry, Marketing, D4, L81,
Explaining UK Food Price Inflation. (Transparency of Food Pricing (TRANSFOP) Working Paper 1)
Retail food price inflation in the UK peaked at nearly 14% in the summer of 2008, a level much higher than had been seen in the previous 10 years and, since then, food price inflation has continued to lead general inflation. An obvious factor driving domestic retail food prices is world
commodity prices, but other factors matter too. In this paper, we model UK food price inflation and explore a range of potential drivers including world food prices, exchange rates, manufacturing costs, oil prices and wages. Over the
period 1990-2010, we show that the major drivers of UK food price inflation are world raw food prices and the exchange rate; less important are manufacturing costs, unemployment and earnings. Oil prices matter too but indirectly via their effect on world agricultural commodity prices. We also show that the effect on domestic retail food price inflation depends on the duration of the shocks arising on world commodity markets
CV18018
This report provides the main results of the 2018 underwater television survey on the âLabadie, Jones and Cockburn Banksâ ICES assessment area; Functional Unit 20-21. This was the fifth survey to achieve full coverage of the full area. The 2018 survey was multidisciplinary in nature collecting UWTV, and other ecosystem data. A total of 96 UWTV stations were completed at 6 nm intervals over a randomised isometric grid design. The mean burrow density was 0.27 burrows/m2 compared with 0.44 burrows/m2 in 2017. The 2018 geostatistical abundance estimate was 2.7±0.006 billion, a 39% decrease on the abundance for 2017, with a CV of 4% which is well below the upper limit of 20% recommended by SGNEPS 2012. High densities were observed throughout the ground, and also close to boundaries. Using the 2018 abundance estimate and updated stock data implies catch of 5,320 t and landings of 4,325 t in 2019 when MSY approach is applied (assuming that discard rates and fishery selection patterns do not change from the average of 2015â2017). One species of sea-pen (Virgularia mirabilis) were recorded as present at the stations surveyed. Trawl marks were observed at 33% of the stations surveyed
Retail Food Price Modelling Project Report
This research was undertaken on behalf of Defra under Invitation to Tender Number 24580 to provide further research into modelling UK retail food price inflation. It follows from previously-commissioned work on retail food inflation delivered to Defra in November 2011 comprising the majority of the current research team. In the previous research, the team developed an econometric model to estimate the impact of world commodity prices on UK food inflation while accounting for a range of wider factors that may impact on world and domestic retail food prices and, more specifically, the magnitude of the world-retail price transmission effects. The estimates from the model were then used to forecast the impact of developments on world commodity markets as well as other factors influencing price transmission such as exchange rates and oil prices on UK retail food inflation. The context for the previous research on forecasting retail food inflation in the UK was the exposure to shocks emanating from world markets, in particular following the world price âspikesâ of 2007-2008 and 2011. This was a period of considerable price volatility on world markets involving not only agricultural commodities but also oil, both of which were reflected in volatile domestic retail food inflation. The issue of high and volatile food inflation was not confined to the UK, though the experience of food inflation in the UK was more intense than in many other European Union (EU) countries. Since then, however, the challenges facing the UK food system and the exposure of UK consumers to these challenges have changed, particularly following the UKâs decision to exit the European Union. Given the uncertainty that will be involved in the UKâs departure from the EU and the range of alternative trading arrangements that may replace the current trade regime, it is desirable to renew the effort in understanding how the UK food sector (from the farm level through to final consumers) will be affected by these new trade arrangements. To address these issues, the framework initially conceived and delivered under the previous research contract had to be significantly revised. In addition to accommodating more recent data in the econometric model, an innovative feature of the revised food inflation model is the creation of new price indices to reflect specifically what the UK imports and from where. Employing a readily-available world commodity price index, as done in the previous research, is not fit for this specific purpose for two reasons. First, as a portmanteau measure of prices on world commodity markets, it does not reflect the price of what the UK actually imports. Specifically, it ignores that the UK purchases a significant quantity of its food and agricultural products from the EU which are subject to the EUâs common trade policy and hence prices differ from those on world markets. Second, since the UKâs exit from the European Union is likely to involve fundamental changes to international trade measures with potentially both EU and non-EU countries, import prices are likely to change. Hence, it will be necessary to reflect agricultural and food import prices from different sources, including changes to any tariff and non-tariff measures that are applied. Furthermore, changes to the geographical source of UK food imports will also have implications for other data series that impact on domestic food prices, most obviously exchange rates. In particular, it necessitated the creation of an effective exchange rate that reflects the composition of agricultural and food trade that is potentially different from that applicable in the past. These newly-created agricultural-food price and appropriately-weighted effective exchange rate indices form key inputs into the revised framework. There are also a number of other new features to the current research. In particular, since a large part of the UKâs agricultural and food trade relates to processed food products, we create bespoke price indices that reflect the importance of products produced at ii different stages of the food chain. Specifically, we develop models that are based on (a) prices (and effective exchange rates) of agricultural commodities only and (b) a model that includes processed and manufactured food as well as raw agricultural commodity prices and the appropriately weighted exchange rates. While the âall-productâ model is our primary focus, the âagriculture-onlyâ model is useful because it facilitates a direct comparison of UK import prices with the prices of agricultural products on international markets. The distinction is important with implications for food price transmission in the UK. In this report, we present the results and insights from this new research. After setting out the context and objectives of the current project, we present an update to the previous food price inflation model (which we label âDefra Iâ) with more recent data to assess its current validity. Following this, we present the derivation of the new price and effective exchange rate indices which form the main new inputs into the revised modelling (labelled âDefra IIâ). It should be noted that, due to the nature of the new data we are working with, and the intention of differentiating between trade with EU and non-EU countries, the specification of the Defra II econometric model differs from the Defra I specification. After an explanation of its structure, estimates of the new model are presented. The results from the econometric model confirm the important role played by domestic factors (including non-agricultural costs (such as labour and energy) and domestic agricultural output prices) as well as international factors (import prices and exchange rates) in determining UK retail food inflation. A major output of the project is the creation of a bespoke Excel-based modelling tool referred to as the âScenario Tool Exeter Food Inflationâ (STEFI). This tool uses the econometric outputs developed in Defra II to deliver estimated effects of alternative post-EU exit trade scenarios on retail food prices. STEFI is user-friendly and has been developed specifically for use within Defra to calculate the dynamic effects of a wide range of scenarios with the option to build-up sequentially the effects in combination with factors such as non-tariff barriers and exchange rates. Finally, in the last two sections of the report, results of two special studies are presented. The first is an analysis of retail food price inflation for different income deciles of the UK population. The second investigates whether the entry of discounters into the UK retail food sector since 2010 may have altered the transmission of agricultural and processed food prices. Our investigation of these issues are tentative in nature and suggest the need for further research to identify the impact of new trade arrangements on different income groups and how the changing structure of the food sector may impact on the transmission of prices through the food supply chain to retail. Taken together, the revised retail food inflation model that is contained in this report represents a substantial development of previous modelling and provides Defra with the flexibility to assess the retail food price effects that may come about as the UKâs trade arrangements with the European Union change and trade arrangements with non-European Union countries develop
Ancient Pastoral Settlement in The Dhofar Mountains: Archaeological Excavations at Shakil and Halqoot
For much of Dhofarâs history and prehistory, most of its population has been mobile in search of wild game and
with herded domesticated animals, which need new grass and browse. While few archaeological sites in the
southern region of Oman suggest permanent or even semi-permanent occupations, there is now clear evidence
of a distinct and perhaps unique episode of well-constructed, semi-permanent settlements in the Jebel QÄra,
Dhofar. In 2012 and 2017, archaeological teams established a chronology, occupation history, and pastoralisthunter
lifestyle of these settlementsâ occupants, raising new questions about episodes of pastoralist settlement
in long-term context. This paper documents the archaeological sites, their architectural details and layout,
associated finds, and preliminary assessments of their faunal and vegetative components
Western Irish Sea Nephrops Grounds (FU15) 2017 UWTV Survey Report and catch options for 2018
This report provides the main results and findings of the 15th annual underwater television survey on the âIrish sea west Nephrops groundsâ ICES assessment area, Functional Unit 15. The survey was multi-disciplinary in nature collecting UWTV and other ecosystem data. The 2017 design consisted of a randomised isometric grid of 100 stations at 4.5 nautical mile intervals out over the full known extent the stock. The resulting krigged burrow abundance estimate was 5.3 billion burrows. This was a similar result of that obtained in 2006, and 4% higher than the abundance in 2016. In contrast to 2016 the spatial distribution of burrows appears more homogenous across the survey area. Overall densities are high and abundance remains stable, well above MSY Btrigger. Reducing the number of stations compared to 2011 has not affected the accuracy of the survey estimate to date. The CV (or relative standard error) of 3% is in line with previous estimates and well below the upper limit of 20% recommended by SGNEPS 2012. Total catches and landings options at various different fishing mortalities were calculated and fishing at Fmsy in 2017 implies a total catch option at Fmsy (=Fmax) of 11,807 tonnes which results in landings of no more than 9,630 tonnes. The only sea-pen species observed in 2017 was Virgularia mirabilis and this was found at 16% of stations ranging from occasional to common, with high densities observed in the south-west of the ground. Trawl marks were noted at 36% of the UWTV stations
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