Pork in Taiwan has played an important role in terms of domestic consumption, production and price fluctuation in several decades. This study attempts to investigate the causal relationship between hog and feedstuff p...Pork in Taiwan has played an important role in terms of domestic consumption, production and price fluctuation in several decades. This study attempts to investigate the causal relationship between hog and feedstuff prices in Taiwan by using monthly time series over the period of January 2000 to October 2010. Prices from hog, feedstuff, soybean meal and corn are considered and performed through a multivariate vector autoregressive （VAR） model. As the empirical results, the long-run equilibrium is captured identifying price elasticity among the variables using the Johansen cointegration diagnosis. Then, the Granger causality approach shows that bidirectional relationship is detected running from feedstuff to corn and from soybean meal to hog as well as unidirectional relationship running from corn to hog, from feedstuff to hog and from soybean meal to feedstuff. In the conclusions, we point out to raw material prices of feedstuff, namely corn and soybean meal that have an importance to hog price as the cost of meat production. Pig farmers and policy-makers should understand the behavior of price interactions to manage the risks on hog market and to increase the profitability on suitable price.展开更多
文摘Pork in Taiwan has played an important role in terms of domestic consumption, production and price fluctuation in several decades. This study attempts to investigate the causal relationship between hog and feedstuff prices in Taiwan by using monthly time series over the period of January 2000 to October 2010. Prices from hog, feedstuff, soybean meal and corn are considered and performed through a multivariate vector autoregressive （VAR） model. As the empirical results, the long-run equilibrium is captured identifying price elasticity among the variables using the Johansen cointegration diagnosis. Then, the Granger causality approach shows that bidirectional relationship is detected running from feedstuff to corn and from soybean meal to hog as well as unidirectional relationship running from corn to hog, from feedstuff to hog and from soybean meal to feedstuff. In the conclusions, we point out to raw material prices of feedstuff, namely corn and soybean meal that have an importance to hog price as the cost of meat production. Pig farmers and policy-makers should understand the behavior of price interactions to manage the risks on hog market and to increase the profitability on suitable price.
