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Factors Affecting The Demand For And Supply Of South African Yellow Maize Exports

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  • Cleasby, R. C. G.
  • Darroch, M. A. G.
  • Ortmann, G. F.

Abstract

A simultaneous-equation model containing yellow maize export demand and supply functions was specified and estimated by Two-Stage Least Squares using annual data for the period 1960-1990. Export demand was influenced by the world price (real) of yellow maize and lagged exports. Export supply was explained by the lagged domestic producer price, lagged exports and random shocks in supply. The price elasticity of export demand estimated directly from the model was high (-37.90), but lower than that estimated by Johnson's indirect method (-181.30). Export supply in the short- and long-run was price inelastic and relatively more responsive to supply shocks. These results support a priori expectations that local yellow maize producers are price takers on the world market and that export supply reacts sluggishly to changes in the lagged producer price of yellow maize. Climatic variation was the major determinant of export supply. Implications for future yellow maize export supply of potential world trade liberalisation and niche marketing are discussed.

Suggested Citation

  • Cleasby, R. C. G. & Darroch, M. A. G. & Ortmann, G. F., 1993. "Factors Affecting The Demand For And Supply Of South African Yellow Maize Exports," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 32(1), March.
    • Handle: RePEc:ags:agreko:267562
    DOI: 10.22004/ag.econ.267562
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    References listed on IDEAS

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    1. Morris Goldstein & Mohsin S. Khan, 2017. "The Supply and Demand for Exports: A Simultaneous Approach," World Scientific Book Chapters, in: TRADE CURRENCIES AND FINANCE, chapter 2, pages 83-104, World Scientific Publishing Co. Pte. Ltd..
    2. Johnson, Paul R., 1971. "Studies In The Demand For U. S. Exports Of Agricultural Commodities," Department of Economics and Business - Archive 259733, North Carolina State University, Department of Economics.
    3. van Zyl, Johan, 1991. "Research Note: An Analysis Of The Supply Of Maize In South Africa," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 30(1), March.
    4. Paul R. Johnson, 1977. "The Elasticity of Foreign Demand for U.S. Agricultural Products," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 59(4), pages 735-736.
    5. C.D. Throsby & David J.S. Rutledge, 1979. "The Elasticity Of Demand For Exports: A Reply," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 23(1), pages 67-68, April.
    6. van Zyl, J., 1986. "A Statistical Analysis Of The Demand For Maize In South Africa," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 25(3), October.
    7. Marc Nerlove, 1956. "Estimates of the Elasticities of Supply of Selected Agricultural Commodities," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 38(2), pages 496-509.
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    1. Poonyth, Daneswar & van Zyl, Johan & Meyer, Ferdinand H., 2000. "Forecasting the market outlook for the South African maize and sorghum sector using econometric modeling," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 39(4), pages 1-13, December.

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