IDEAS home Printed from https://ideas.repec.org/a/eme/caerpp/v5y2013i4p459-472.html
   My bibliography  Save this article

The impacts of production uncertainties on world food prices

Author

Listed:
  • Stefan Meyer
  • Xiaohua Yu

Abstract

Purpose - – Because of large time lags between the production decision, completion and sale of output, any uncertainty during the process of production, such as bad weather, disease or financial crisis, can affect the prices within food markets systematically. Therefore, the paper aims to analyze the influence of production uncertainties on world's wheat and corn prices. Design/methodology/approach - – In a specially designed two-step method, at first, the contributions of deterministic and uncertainty factors to wheat and corn production in around 100 countries are decomposed. Then, a panel model is applied to estimate the combined impact of each type of factors on the prices. Furthermore, the authors decompose the explained variances of the panel models in order to determine the importance of each type of factors for price adjustments. Findings - – The uncertainties in wheat production do significantly affect both wheat and corn prices on a global scale, whilst those of corn do not. Moreover, the variance decompositions reveal that deterministic factors contribute much more to the explanation of world food prices than indeterministic factors. Practical implications - – As deterministic factors are much more important than uncertainty factors for explaining market price movements, farmers should organize themselves to coordinate production in order to stabilize world food prices. Originality/value - – The paper proposes a simple methodology, which enables scholars to integrate production uncertainties into food price analyses.

Suggested Citation

  • Stefan Meyer & Xiaohua Yu, 2013. "The impacts of production uncertainties on world food prices," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 5(4), pages 459-472, November.
    • Handle: RePEc:eme:caerpp:v:5:y:2013:i:4:p:459-472
    DOI: 10.1108/CAER-05-2012-0045
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/CAER-05-2012-0045/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.emerald.com/insight/content/doi/10.1108/CAER-05-2012-0045/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1108/CAER-05-2012-0045?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Loum, Alieu & Fogarassy, Csaba, 2015. "The effects of climate change on cereals yield of production and food security in Gambia," APSTRACT: Applied Studies in Agribusiness and Commerce, AGRIMBA, vol. 9(4), pages 1-10, December.
    2. Xiaohua Yu, 2014. "Raising food prices and welfare change: a simple calibration," Applied Economics Letters, Taylor & Francis Journals, vol. 21(9), pages 643-645, June.
    3. Yu, Xiaohua & Abler, David, 2014. "Where have all the pigs gone? Inconsistencies in pork statistics in China," China Economic Review, Elsevier, vol. 30(C), pages 469-484.
    4. Yu, Xiaohua, 2014. "Monetary easing policy and long-run food prices: Evidence from China," Economic Modelling, Elsevier, vol. 40(C), pages 175-183.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:caerpp:v:5:y:2013:i:4:p:459-472. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.