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The Future Of The World Sugar Market--A Spatial Price Equilibrium Analysis

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  • Nolte, Stephan

Abstract

A spatial price equilibrium (SPE) model of the world sugar market is programmed. The model covers more than hundred regions and contains sugar in as a sole product. It has a detailed coverage of policies and bilateral trade agreements. It is programmed as a mixed complementarity problem (MCP) in GAMS and uses the PATH solver. The SPE framework offers considerable advantages over other model approaches applied to the sugar market before. Four scenarios are simulated: A baseline scenario until 2015/16, accounting for implementation of the EU reform and market access commitments already decided upon. The liberalization scenarios include an implementation of the Falconer proposal for the current round of WTO negotiations, a full liberalization by the EU and a liberalization of all sugar policies world-wide. In the latter the world market price increases by around 30%. Results are discussed and related to special properties of the SPE approach. Strengths and weaknesses are identified and an outlook on the further refinement of the analysis is given.

Suggested Citation

  • Nolte, Stephan, 2008. "The Future Of The World Sugar Market--A Spatial Price Equilibrium Analysis," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6663, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa107:6663
    DOI: 10.22004/ag.econ.6663
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    References listed on IDEAS

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    1. Amani Elobeid & John Beghin, 2006. "Multilateral Trade and Agricultural Policy Reforms in Sugar Markets," Journal of Agricultural Economics, Wiley Blackwell, vol. 57(1), pages 23-48, March.
    2. Beghin, John C. & Dong, Fengxia & Elobeid, Amani & Fabiosa, Jacinto F. & Fuller, Frank H. & Hart, Chad E. & Kovarik, Karen P. & Tokgoz, Simla & Yu, Tun-Hsiang & Wailes, Eric J. & Chavez, Edward & Woma, 2007. "FAPRI 2007 U.S. And World Agricultural Outlook," Staff General Research Papers Archive 12805, Iowa State University, Department of Economics.
      • Beghin, John C. & Dong, Fengxia & Elobeid, Amani E. & Fabiosa, Jacinto F. & Fuller, Frank H. & Hart, Chad E. & Kovarik, Karen & Tokgoz, Simla & Yu, Tun-Hsiang (Edward) & Wailes, Eric J. & Chavez, Eddi, 2007. "FAPRI 2007 U.S. and World Agricultural Outlook," FAPRI Staff Reports 7296, Food and Agricultural Policy Research Institute (FAPRI).
    3. Richard E. Howitt, 1995. "Positive Mathematical Programming," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(2), pages 329-342.
    4. Elobeid, Amani & Beghin, John C., 2005. "Multilateral Trade and Agricultural Policy Reforms in Sugar Markets (Revised)," Staff General Research Papers Archive 12419, Iowa State University, Department of Economics.
    5. Mitchell, Donald, 2004. "Sugar policies opportunity for change," Policy Research Working Paper Series 3222, The World Bank.
    6. Phillip M. Bishop & Charles F. Nicholson & James E. Pratt & Andrew M. Novakovic, 2001. "Tariff-Rate Quotas : Difficult to model or plain simple?," Trade Working Papers 22011, East Asian Bureau of Economic Research.
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    Cited by:

    1. Nolte, Stephan & Grethe, Harald, 2012. "Der Markt für Zucker," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 61(Supplemen), pages 1-14, February.
    2. Nolte, Stephan & Grethe, Harald, 2011. "Der Markt für Zucker," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 61.
    3. Bart Van der Straeten & Jeroen Buysse & Stephan Nolte & Ludwig Lauwers & Dakerlia Claeys & Guido Van Huylenbroeck, 2010. "A multi-agent simulation model for spatial optimisation of manure allocation," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 53(8), pages 1011-1030.
    4. Grethe, Harald & Nolte, Stephan & Banse, Martin, 2008. "Modelling The Effects Of Eu Sugar Market Liberalization On Area Allocation, Production And Trade," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6329, European Association of Agricultural Economists.
    5. Koen Dillen & Matty Demont & Eric Tollens, 2008. "European Sugar Policy Reform and Agricultural Innovation," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 56(4), pages 533-553, December.
    6. Massimiliano Calì & Stephan Nolte & Nicola Cantore, 2013. "Sweet and Sour Changes in Trade Regimes," The World Economy, Wiley Blackwell, vol. 36(6), pages 786-806, June.
    7. Haß, Marlen, 2016. "Der Zuckermarkt Im Wandel: Was Passiert Nach Dem Eu-Quotenende?," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 245190, German Association of Agricultural Economists (GEWISOLA).
    8. Marlen Haß, 2022. "Liberalising the EU sugar market: what are the effects on third countries?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(3), pages 638-667, July.

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