The Emergence of Biofuels and the Co-Movement Between Crude Oil and Agricultural Prices

The Emergence of Biofuels and the Co-Movement Between Crude Oil and Agricultural Prices
Author: Francisco Penaranda
Publisher:
Total Pages: 31
Release: 2015
Genre:
ISBN:

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Biofuels are becoming an alternative to non-renewable energy sources but we know little about the economic mechanisms influencing their prices. This paper studies the interrelationships between the spot prices of oil and those of agricultural commodities used as biofuel feedstocks. Using daily data since 1988, we identify a co-movement after 2005 that does not appear for other food-related commodities and is not due to general economic variables. We also find traces of the co-movement in the prices of a large biofuel stock. The results amount to the first systematic piece of empirical evidence linking spot oil and agricultural markets via the emergence of biofuels.

Co-movement of major commodity price returns: A time-series assessment

Co-movement of major commodity price returns: A time-series assessment
Author: de Nicola, Francesca
Publisher: Intl Food Policy Res Inst
Total Pages: 44
Release: 2014-06-13
Genre: Social Science
ISBN:

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This paper provides a comprehensive analysis of the degree of co-movement among the nominal price returns of 11 major energy, agricultural, and food commodities using monthly data between 1970 and 2013. The authors study the extent and the time evolution of unconditional and conditional correlations using a uniform-spacings testing approach, a multivariate dynamic conditional correlation model and a rolling regression procedure.

The Economics of Biofuel Policies

The Economics of Biofuel Policies
Author: Harry de Gorter
Publisher: Springer
Total Pages: 320
Release: 2015-04-09
Genre: Business & Economics
ISBN: 1137414855

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The global food crises of 2008 and 2010 and the increased price volatility revolve around biofuels policies and their interaction with each other, farm policies and between countries. While a certain degree of research has been conducted on biofuel efficacy and logistics, there is currently no book on the market devoted to the economics of biofuel policies. The Economics of Biofuel Policies focuses on the role of biofuel policies in creating turmoil in the world grains and oilseed markets since 2006. This new volume is the first to put together theory and empirical evidence of how biofuel policies created a link between crop (food grains and oilseeds) and biofuel (ethanol and biodiesel) prices. This combined with biofuel policies role in affecting the link between biofuels and energy (gasoline, diesel and crude oil) prices will form the basis to show how alternative US, EU, and Brazilian biofuel policies have immense impacts on the level and volatility of food grain and oilseed prices.

Comovement in Crude Oil and Biofuel Markets

Comovement in Crude Oil and Biofuel Markets
Author: Mathieu Fournier
Publisher:
Total Pages:
Release: 2016
Genre:
ISBN:

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The 2007-2008 food crisis had severe political, economic, and social consequences worldwide and shed light on the new existing integration between energy and agricultural commodity markets. Scholars subsequently analyzed the factors that had given raise to this integration and were particularly interested in the contribution of the three price transmission channels: the cost, financialization, and substitution channel. Using daily futures prices over the period from January 1990 to December 2014 for twenty-four US commodities, the study at hand extends the existing research and provides evidence of potential structural breaks in the comovement between energy and agricultural commodity prices, assesses the relative importance of each of the three price transmission channels in integrating energy and agricultural commodity markets, and estimates the potential contribution of important US biofuels regulations to this integration. By following a statistical approach that was recently developed, this study, first of all, demonstrates that agricultural commodities that can also be used as biofuel feedstocks exhibit structural breaks in their comovement with crude oil at the end of the Summer 2004. Using a Difference-in-Differences approach, the study at hand then decomposes the contribution of the different price transmission channels to the comovement variations during the 2005-2014 period. It provides evidence for the contribution of all three channels to a massive comovement increase after January 2005, and shows that the substitution channel subsequently contributed to a comovement decrease at the beginning of 2010. Overall, this study concludes that the jump in comovement between US energy and agricultural commodity prices that occurred between 2005 and 2010, and ultimately contributed to the severe food crisis, was caused by both extreme high crude oil prices and US regulations promoting biofuels. In this respect, this study id.

Biofuels in Africa

Biofuels in Africa
Author: Donald Mitchell
Publisher: World Bank Publications
Total Pages: 220
Release: 2010-11-24
Genre: Business & Economics
ISBN: 0821385178

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A new economic opportunity for sub-Saharan Africa is looming large: biofuel production. Rapidly rising energy prices are expected to remain high for an extended period of time because of the increasing demand in prospering and populous countries such as China and India, the depletion of easily accessible supplies of crude oil, and concern over global climate change. As a result, there is renewed interest in biofuels as an alternative to fossil fuels. Africa is uniquely positioned to produce these new cash crops for both domestic use and export. The region has abundant land resources and preferential access to protected markets with higher-than-world-market prices. The rapid growth in the demand for transport fuels in Africa and high fuel prices create domestic markets for biofuels. The European Union and the United States have approved legislation that requires large increases in the consumption of biofuels over at least the next decade. Imports are expected to be needed to meet these mandates, thus opening the door to African and other developing countries that can produce biofuels or feedstocks for biofuels competitively. Expanding the production of crops for biofuels will affect the entire rural sector in Africa as resources are shifted away from traditional crops and the prices of all agricultural commodities rise. Even smallholders can participate in producing biofuel crops. To promote the sustainability and significant contribution of this enterprise, Biofuels in Africa provides guidance in formulating suitable policy regimes, which are based on protecting the rights of current land users, developing revenue-sharing schemes with local communities, safeguarding the environment and biodiversity, expanding institutional capacity, formulating new regulations and procedures, and emulating best practices from experienced countries. This volume will be of value to anyone interested in biofuels, including policy makers, development practitioners, private investors, researchers, and the general public. Now that African countries are trying to significantly increase their energy supply systems, biofuels are an attractive option using both dedicated crops and agricultural waste. This book provides guidance for them to develop a suitable policy regime for a significant contribution by biofuels. Professor Ogunlade R. Davidson, Minister of Energy and Water Resources, Sierra Leone Biofuels in Africa is a sorely needed resource for our understanding of the problems of expanding biofuels production in Africa. A high point of the book is a description of the projects that were started in several countries. A very useful book! Professor Jos Goldemberg, University of S o Paulo, Brazil As Africa most likely will play the same role for global biofuels as the Middle East does for oil, this comprehensive book on African biofuels should be compulsory reading for anyone interested in either African development or biofuels. The book captures the essence of long-term drivers and opportunities as well the complex challenges for investors and society of this huge emerging industry. Per Carstedt, Executive Chairman, EcoEnergy Africa

Sustainable Development of Electrical Energy Storage Technologies in Energy Production

Sustainable Development of Electrical Energy Storage Technologies in Energy Production
Author: Grigorios L. Kyriakopoulos
Publisher: MDPI
Total Pages: 288
Release: 2021-04-23
Genre: Science
ISBN: 3036509283

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Nowadays, energy production increase has been proven a globally contentious issue, as it counts variable stakeholders of competitive interests. Such indicative competitive interests are land use for energy crops against maximizing agricultural production yields, as well as the gradually localized trend of energy production from renewables, compared to the central overexploitation of fossil-fuelled energy sources in mainland grids of energy production. In response to this multi-parametric contradiction on traditional and novel approaches of energy production, this Special Issue aims at attracting researchers whose scientific interest resides in the electrical energy storage (EES) systems in a wide range of applicability: Technological advancements, environmental impacts, economies of scale achievement, active involvement of renewables in EES technologies, socio-economic impacts upon EES diffusion in regional and globalized contexts of analysis. The main limitations and the challenges derived from these scientific approaches will formulate a fresher scientific viewpoint of novel insights upon EES applicability in developed and developing economies, accordingly. Papers selected for this Special Issue are subject to a rigorous peer review procedure, enabling an integrated manner of dissemination upon research advancements and multi-disciplinary dynamics, accordingly.

Long-Run and Short-Run Co-Movements in Energy Prices and the Prices of Agricultural Feedstocks for Biofuel

Long-Run and Short-Run Co-Movements in Energy Prices and the Prices of Agricultural Feedstocks for Biofuel
Author: Robert J. Myers
Publisher:
Total Pages: 0
Release: 2020
Genre:
ISBN:

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Recent expansions in biofuel production have led to concerns about an emerging “new relationship” between energy prices and the prices of agricultural feedstock for biofuel. We provide new econometric evidence on this relationship using common trend-common cycle decompositions to estimate long-run and short-run co-movement across various energy and agricultural prices. We also test for the presence of regime changes that may alter the relationship between energy and agricultural feedstock prices under certain conditions. We find that co-movements between energy and agricultural feedstock prices tend to dissipate in the long-run, which has important implications for biofuel and food policy.

Renewable Fuel Standard

Renewable Fuel Standard
Author: National Research Council
Publisher: National Academies Press
Total Pages: 416
Release: 2012-01-29
Genre: Technology & Engineering
ISBN: 0309187516

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In the United States, we have come to depend on plentiful and inexpensive energy to support our economy and lifestyles. In recent years, many questions have been raised regarding the sustainability of our current pattern of high consumption of nonrenewable energy and its environmental consequences. Further, because the United States imports about 55 percent of the nation's consumption of crude oil, there are additional concerns about the security of supply. Hence, efforts are being made to find alternatives to our current pathway, including greater energy efficiency and use of energy sources that could lower greenhouse gas (GHG) emissions such as nuclear and renewable sources, including solar, wind, geothermal, and biofuels. The United States has a long history with biofuels and the nation is on a course charted to achieve a substantial increase in biofuels. Renewable Fuel Standard evaluates the economic and environmental consequences of increasing biofuels production as a result of Renewable Fuels Standard, as amended by EISA (RFS2). The report describes biofuels produced in 2010 and those projected to be produced and consumed by 2022, reviews model projections and other estimates of the relative impact on the prices of land, and discusses the potential environmental harm and benefits of biofuels production and the barriers to achieving the RFS2 consumption mandate. Policy makers, investors, leaders in the transportation sector, and others with concerns for the environment, economy, and energy security can rely on the recommendations provided in this report.

Uncertainty Analysis in Econometrics with Applications

Uncertainty Analysis in Econometrics with Applications
Author: Van-Nam Huynh
Publisher: Springer Science & Business Media
Total Pages: 323
Release: 2012-12-14
Genre: Technology & Engineering
ISBN: 3642354432

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Unlike uncertain dynamical systems in physical sciences where models for prediction are somewhat given to us by physical laws, uncertain dynamical systems in economics need statistical models. In this context, modeling and optimization surface as basic ingredients for fruitful applications. This volume concentrates on the current methodology of copulas and maximum entropy optimization. This volume contains main research presentations at the Sixth International Conference of the Thailand Econometrics Society held at the Faculty of Economics, Chiang Mai University, Thailand, during January 10-11, 2013. It consists of keynote addresses, theoretical and applied contributions. These contributions to Econometrics are somewhat centered around the theme of Copulas and Maximum Entropy Econometrics. The method of copulas is applied to a variety of economic problems where multivariate model building and correlation analysis are needed. As for the art of choosing copulas in practical problems, the principle of maximum entropy surfaces as a potential way to do so. The state-of-the-art of Maximum Entropy Econometrics is presented in the first keynote address, while the second keynote address focusses on testing stationarity in economic time series data.