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The relationship between trade and price volatility in the Mexican and US maize markets

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  • Araujo-Enciso, Sergio Rene

Abstract

The supply of maize in the Mexican market depends to a large extent from the US imports which represent a large share of the domestic consumption. Furthermore imports exhibit a seasonal pattern, and peaks are often found close to low levels of domestic production and stocks. The present research suggests that there is a link between imports and prices volatility. Below a threshold value, imports and volatility are not related, but beyond the threshold it is volatility the variable driving imports. From the results one can argue that imports have served as a measure to stabilize prices when the domestic supply is scarce.

Suggested Citation

  • Araujo-Enciso, Sergio Rene, 2012. "The relationship between trade and price volatility in the Mexican and US maize markets," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122544, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa123:122544
    DOI: 10.22004/ag.econ.122544
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    References listed on IDEAS

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    4. Marsh, John M., 2007. "Cross-Sector Relationships Between the Corn Feed Grains and Livestock and Poultry Economies," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 32(1), pages 1-22, April.
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