The Spatial Effect of Ethanol Biorefinery Locations on Local Corn Prices

Ani Katchova

No 49309, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin from Agricultural and Applied Economics Association

Abstract: This study examines whether the local competition for corn to produce ethanol has lead to significantly higher prices for farmers located close to ethanol plants. If any, such price premiums for spatial closeness would be in addition to the general level of corn price changes experienced by farmers throughout the U.S. The difference-in-differences estimation method is used to account for both time and location differences in order to measure the interaction of time and location effects. Using the USDA’s ARMS data, the results show that while prices in real terms have risen over time, farmers located close to ethanol plants have not received significantly higher prices than farmers living farther away from plants. These findings indicate that there is a lack of evidence for price premiums due to the spatial closeness to ethanol plants.

Keywords: Agribusiness; Marketing (search for similar items in EconPapers)
Pages: 12
Date: 2009-07
New Economics Papers: this item is included in nep-agr, nep-ene and nep-geo
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea09:49309

DOI: 10.22004/ag.econ.49309

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