The Ethanol Market and Its Relation to the Price of Agricultural Commodities-Reference-Cited by-同舟云学术

The Ethanol Market and Its Relation to the Price of Agricultural Commodities

Published:2023-03-17 Issue:6 Volume:16 Page:2788
ISSN:1996-1073
Container-title:Energies
language:en
Short-container-title:Energies

Author:

Hoeckel Paulo Henrique¹^ORCID,Alvim Augusto Mussi²^ORCID,Pontes José Pedro³^ORCID,Dias João³^ORCID

Affiliation:

1. Department of Economics, Federal University of Grande Dourados, Dourados 79825-070, Mato Grosso do Sul, Brazil

2. Business School, Pontifical Catholic University of Rio Grande do Sul, Porto Alegre 90619-900, Rio Grande do Sul, Brazil

3. Lisbon School of Economics and Management, Universidade de Lisboa, 1200-781 Lisbon, Portugal

Abstract

In this article, we seek to present the synthesis of the global ethanol market in the United States (US) and Brazil by using caloric equivalence to empirically characterize the elasticity of supply and demand. We also seek to evaluate the relationship between world ethanol production and prices of agricultural commodities (wheat, rice, corn, soybeans and sugar) from 1981 to 2016 using climate-induced yield shocks as instrumental variables. The main results for the world market indicate that the production and demand for ethanol respond elastically to changes in commodity prices. The world ethanol production has no significant relationship with food prices. However, evaluation of the ethanol market and its interaction with the agricultural commodities market confirms the hypothesis that Brazilian ethanol is weakly related to the price of food.

Funder

Coordenação de Aperfeiçoamento de Pessoal de Nível Superior

Scholarship CAPES in Lisbon School of Economics & Management/Universidade de Lisboa

Publisher

MDPI AG

Subject

Energy (miscellaneous),Energy Engineering and Power Technology,Renewable Energy, Sustainability and the Environment,Electrical and Electronic Engineering,Control and Optimization,Engineering (miscellaneous),Building and Construction

Link

https://www.mdpi.com/1996-1073/16/6/2788/pdf

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