Testing for signals on oligopolistic behaviour – case of Finnish and German pork meat price

Market integration of Finland toward EU has important implication to domestic agricultural policy. Our aim is to estimate the characteristics of the Finnish pork markets in relation to Germany. Our analysis use symmetric and asymmetric threshold error correction models. Pork prices are found cointegrated, and cointegration relationship of two counties is found asymmetric. A large positive shock in Germany is transmitted faster to Finland than a large negative one. It implies that a combination of cooperative processors and public quoted companies as in Finland, can smooth out some of the short term price fluctuations observed abroad.cointegration, asymmetric, error correction, Agricultural and Food Policy, Marketing,

Horizontal Price Transmission of the Finnish Meat Sector with Major EU Players

The integration of the Finnish meat market in the EU has important implications for domestic agricultural policy. Our aim is to estimate the characteristics of the Finnish pork and beef markets in relation to those of Germany and Denmark. Our analysis uses symmetric and asymmetric threshold error correction models. Both pork and beef prices in Finland are found to have slowly cointegrated with German prices, but the cointegration relationship of the two counties is only found to be symmetric for pork prices, while it is asymmetric for beef prices. The producer price for pork in Finland is symmetrically cointegrated with the Danish price, but the Finnish and Danish beef prices show a random walk. This implies that the price transmission to the Finnish pork producer market from the EU market is smoother and more efficient than for the beef market. However, the speed of transmission is still slow compared to that between the Danish and German markets.cointegration, asymmetric, error correction, thresholds, pork and beef prices, Demand and Price Analysis, Livestock Production/Industries,

Horizontal price transmission of the Finnish meat sector with major EU players

The integration of the Finnish meat market in the EU has important implications for domestic agricultural policy. Our aim is to estimate the characteristics of the Finnish pork and beef markets in relation to those of Germany and Denmark. Our analysis uses symmetric and asymmetric threshold error correction models. Both pork and beef prices in Finland are found to have slowly cointegrated with German prices, but the cointegration relationship of the two counties is only found to be symmetric for pork prices, while it is asymmetric for beef prices. The producer price for pork in Finland is symmetrically cointegrated with the Danish price, but the Finnish and Danish beef prices show a random walk. This implies that the price transmission to the Finnish pork producer market from the EU market is smoother and more efficient than for the beef market. However, the speed of transmission is still slow compared to that between the Danish and German markets.cointegration, asymmetric, error correction, thresholds, pork and beef prices, Agribusiness, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, International Relations/Trade,

Impact and competitiveness of EU biofuel market – First view of the prices of biofuel market in relation to the global players

The goal of this study is to investigate the price relationship of EU biofuel market with other main markets in both horizontal level and vertical level. We first carry out Granger causality between ethanol price of EU, USA and Brazil. Secondly, we use vecto error cointegration Mechnism (VECM) to test the relationship between three selected vegetable oil prices in EU to see the competive potential of EU rapeseed oil compared with imported crude palm oil and soybean oil as the feedstock of biodiesel. Evidence shows that there is a unidirectional Granger causation from both USA and Brazil to EU market. USA price of ethanol is the most influential among the three price series, and EU has the least influence on the contrary. It indicates that it is very necessary for EU to set up its own price indicator, for instance, futures prices in EURONEXT. However, in biodiesel market, production in EU has some potential in competing with outside of the world since rapeseed oil price show some potential in price competition with other vegetable oils.ethanol, vegetable oils, feedstock, directives, VECM, Granger causality, Crop Production/Industries, International Relations/Trade, Research and Development/Tech Change/Emerging Technologies,

Testing market efficiency of crude palm oil futures to European participants

Palm oil is the most consumed and traded vegetable oils in the EU and the world. Increasing non-food uses for vegetable oils in especially feedstock of biofuels in recent years have caused the price volatility to rise in both EU and global market. The most efficient pricing of crude palm oil (CPO) is to found on Bursa Malaysia (BMD), and it provides by far the world’s most liquid palm oil contract. The goal of this study is to investigate CPO futures market efficiency of BMD for the European participants whose delivery location in EU. Both Johanson cointegration test and Vector Error Cointegration Mechnism (VECM) are conducted to test long-run and short-run efficiency test for the European spot market and four different futures forecasting horizons that are one week, two weeks, one month and two months. Evidence suggests that a long-run equilibrium relationship exists between the futures price and spot price for all forecasting horizons. The unbiasedness of futures price with respect to the spot price in the long-term can be approved for all but the forecasting period of two weeks. Furthermore, the short-term efficiency hypothesis is rejected for the forecasting periods of one week and two month but is approved for the forecasting periods of two weeks and two months.CPO, BMD, efficiency, futures, cointegration, VECM., Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety,