Analysis of the Link between Ethanol, Energy, and Crop Markets, An

Simla Tokgoz and Amani Elobeid

Food and Agricultural Policy Research Institute (FAPRI) Publications from Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University

Abstract: This study analyzes the impact of price shocks in three input and output markets critical to ethanol: gasoline, corn, and sugar. We investigate the impact of these shocks on ethanol and related agricultural markets in the United States and Brazil. We find that the composition of a country's vehicle fleet determines the direction of the response of ethanol consumption to changes in the gasoline price. We also find that a change in feedstock costs affects the profitability of ethanol producers and the domestic ethanol price. In Brazil, where two commodities compete for sugarcane, changes in the sugar market affect the competing ethanol market.

Keywords: agricultural markets; energy; ethanol; renewable fuels. JEL codes: Q11; Q18; Q42 (search for similar items in EconPapers)
Date: 2006-11
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Related works:
Working Paper: Analysis of the Link between Ethanol, Energy, and Crop Markets, An (2006)
Working Paper: Analysis of the Link between Ethanol, Energy, and Crop Markets, An (2006)
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