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

Simla Tokgoz and Amani E. Elobeid

No 18453, Hebrew University of Jerusalem Archive from Hebrew University of Jerusalem

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: Crop Production/Industries; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 53
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ags:hebarc:18453

DOI: 10.22004/ag.econ.18453

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