The Price Dynamics of Selected Herbal and Animal Raw Materials

Oana Matilda Sabie and Stefan Gabriel Burcea

Littera Scripta, 2024, vol. 17, issue 2, 62-86

Abstract: The Federal Republic of Germany is one of the leading producers of milk and milk products as basic elements of the human diet within the European Union. Knowledge of the market prices of milk and milk products and the factors influencing them is important for a number of market operators not only in the Federal Republic of Germany, but also worldwide, when making everyday and major decisions. The aim of this work was to define the development of market prices of selected commodities, namely milk, butter, Gouda cheese, whey, and skimmed milk powder, in the Federal Republic of Germany for the years 2019-2023 and to specify the price correlation between milk and other selected commodities. By analyzing the time evolution using descriptive statistics tools, the development of the market prices of selected commodities was defined, which varied for individual commodities during the period under review. The most stable development was observed for milk market prices, while the most uneven development was identified for butter market prices. The coronavirus pandemic, the war in Ukraine and the high inflation rate had a significant impact on the evolution of prices of selected commodities, with commodity prices rising from their low in 2020 to their high in 2022, but even so, there was no major deviation of prices of selected commodities from their average. The price correlation between milk and other selected commodities was specified using Pearson correlation coefficient and regression analysis. A positive linear relationship was found between market prices of milk and market prices of all other selected commodities. In particular, a very strong linear relationship was registered for the prices of the commodities milk and butter as well as milk and Gouda cheese. During the period under review, the market prices of the selected commodities in the Federal 62 Littera Scripta, 2024, Volume 17, Issue 2 Republic of Germany were influenced by the price of milk 89 % for butter, 81 % for Gouda cheese, 28 % for whey and 49 % for skimmed milk powder. Thus, in addition to the price of milk, other factors influenced the price of other dairy products, including the size of processors' costs, the volume of production in the period, world market conditions and others.

Keywords: Dairy industry; Federal Republic of Germany; time evolution; price relation; linear regression (search for similar items in EconPapers)
Date: 2024
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