Fuel-feed-livestock price linkages under structural changes

Zhige Wu (), Alfons Weersink and Alex Maynard

Applied Economics, 2022, vol. 54, issue 2, 206-223

Abstract: The large-scale diversion of crops into mandates-driven biofuels since early 2000s, has raised concerns about impacts of biofuel policies on food prices. This study examines crude oil-corn-livestock dynamic linkages from January 1987 until December 2019 in Ontario, Canada. A significant structural break is identified in March 2011 as biofuel policy impacts become fully implemented and splits the three-decade period into pre- and post-break sub-periods. A nonlinear autoregressive distributed lag (NARDL) approach is employed since it allows prices to be tied by asymmetric relationships both in the short- and long-run. The NARDL model bounds test results indicate that crude oil and corn prices have a long-run connection with livestock prices in both sub-periods. In the post-break period, corn price has an asymmetric effect on cattle price in the long-run, with negative shocks in the corn price leading to a greater intensity on the cattle price than positive shocks. The presence of short-run asymmetry is evident in the impacts of crude oil price on both cattle and hog prices. However, the above asymmetric effect is insignificant in the pre-break period.

Date: 2022
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1080/00036846.2021.1965082 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:54:y:2022:i:2:p:206-223

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEC20

DOI: 10.1080/00036846.2021.1965082

Access Statistics for this article

Applied Economics is currently edited by Anita Phillips

More articles in Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().