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Steel product prices transmission activities in the midstream industrial chain and global markets

Sui Guo, Huajiao Li, Haizhong An, Qingru Sun, Xiaoqing Hao and Yanxin Liu

Resources Policy, 2019, vol. 60, issue C, 56-71

Abstract: Market competition and trade activities between different economies’ steel industries induce severe steel product price transmission between different economies. Furthermore, steel products in different phases of the industrial chain present various price transmission features. In this research, we calculate the Granger causality relationship between different steel products in different markets and the midstream industry chain. We then construct the global steel product price transmission network and regional price transmission network. We analyze the network indicators and draw the following conclusions. First, emerging economies play a major role in international steel product price transmission activities. Second, billet and plates of middle thickness transmit the most price in the steel market. Third, China imposes price transmission impacts on the most regions with the widest range. Lastly, steel products at the end of the midstream steel industrial chain are “bridges” of price transmission activities. This research will guide market individuals in the steel industry to adjust their behaviors according to market signals.

Keywords: Price transmission; Steel industrial chain; Complex network; Granger causality test (search for similar items in EconPapers)
Date: 2019
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