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This research determines the impacts of COVID-19 US on crawfish production and consumption for 2020 and 2021 using an Equilibrium Displacement Model. In the US, crawfish is one of the seafood commodities where most production is consumed by domestic consumers (7% of domestic consumption is from imports). Crawfish and rice are complementary. Therefore, the impacts of COVID-19 on crawfish consumption simultaneously influence rice production and crawfish producers and consumers. In the first year of COVID-19 (2020), the reduction in crawfish retail demand caused negative effects on final consumers and producers. However, crawfish consumption recovered significantly in the second year (2021), which could compensate for the loss in 2020. Overall, consumer and producer gains ranged from $549 to $626 million if the COVID-19 pandemic only impacted retail consumption. However, in 2021, the increase in production costs due to higher oil/diesel prices and other input prices caused the farm supply to decrease. As a result, total welfare gains ranged from $200 to $228 million. If the demand in 2021 did not increase, but the crawfish farm supply decreased, consumer and producer losses ranged from $929 to $1045 million. Overall, the total effects of COVID-19 on consumers and producers for 2020 and 2021 depend on its effects in 2021. If the demand in 2021 increased following the decrease in farm supply, consumers and producers would benefit from the shocks of COVID-19 due to higher post-COVID-19 demand.
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This paper begins with a survey of recent commodity price developments that highlights the magnitude of this price surge and identifies the rapid rise in wheat prices as a key element. The analysis in this paper focuses on the extent to which domestic markets are insulated from these changes and on the resulting impacts on world prices. An econometric analysis using Error Correction Models finds stable long-term relationships between world wheat prices and most domestic prices of wheat and wheat products, but with considerable variation across countries in the rate of price transmission. A case study of the price shocks during the Covid pandemic and the Ukraine food price crisis finds that price insulation roughly doubled the overall increase in world wheat prices and raised their volatility both during periods of price increase and price decline.
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PurposeThis study analyses how latent variables: environmental hostility, entrepreneurial orientation and dynamic capabilities are demonstrated in practice during the COVID-19 pandemic. Coming from mixed-method research, which is an explanatory sequential research design;this paper aims to provide only the qualitative, practical manifestations and validations of the variables previously tested and analysed quantitatively.Design/methodology/approachA case study approach was used whereby open-ended, semi-structured series of interviews was conducted to extract narratives from two owner–managers of medium-scale manufacturer-exporter agro-processing firms in the Philippines. Thematic analysis using deductive reasoning was used to analyse the collected narratives.FindingsThe analysis showed qualitative evidence of a possible intervention of entrepreneurial orientation and dynamic capabilities between the effects of the hostile environment brought about by the pandemic on the firms' export performance. In addition, organisational resilience was observed to possibly moderate the relationship between the firm's entrepreneurial orientation and dynamic capabilities. Resilience takes time (years) to develop;with an entrepreneurial behaviour, a continuous enhancement and acquisition of resources, capabilities, knowledge reflects a robust and adaptive organisation during adversity.Social implicationsThe role of education and research institutions was highlighted in the development of dynamic capabilities of firms. The entrepreneurial resilience, however, reflects the individual characteristic of the owner–managers that manifests in the firm's overall posture toward the overall goal of protecting the industry from its downfall.Originality/valueQualitative evidences composed of direct experiences from key informants served valuable and contextual (Philippine agro-processing industry) validations to the theoretical relationships of variables being analysed.
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O presente artigo tem como objetivo refletir sobre a relação entre a questão ambiental, crise estrutural do capital e a pandemia do novo Coronavírus. Compreendemos neste trabalho que a pandemia do novo Coronavírus que gera a doença nomeada de Covid-19 está organicamente relacionada com a crise do capital, como fruto do processo de acumulação capitalista avidamente crescente que necessita da exploração inesgotável dos recursos humanos e naturais, tornando-os mercadorias. Essa dupla exploração em ritmo galopante, inerente à ordem sociometabólica do capital, constituem elementos fundamentais para o atual cenário de crise mundial. Para tal reflexão, caminhamos sob a perspectiva do método dialético-crítico de Marx, utilizando-se como metodologia a pesquisa de caráter bibliográfico e documental. Dividimos o trabalho em duas seções centrais: a primeira discute a questão ambiental e a ordem sociometabólica do capital, relação de acumulação e destrutividade;a segunda realiza a relação entre os três eixos de discussão: a crise do capital, a pandemia e a questão ambiental.Alternate :This article aims to reflect on the relationship between the environmental issue, structural crisis of capitalism and the new Coronavirus pandemic. We understand in this work that the pandemic of the new Coronavirus that generates the disease named Covid-19 is organically related to the crisis of capitalism, as a result of the accumulation process greedily growing capitalist that needs the inexhaustible exploitation of human resources and natural, making them commodities. This double exploration at a galloping pace, inherent to sociometabolic order of the capital, constitute fundamental elements for the current scenario of world crisis. For such reflection, we walk under the perspective of the dialectical-critical method of Marx, using bibliographic and documentary research as a methodology. We divided the work into two central sections: the first discusses the environmental issue and the order sociometabolic of capitalism, relation of accumulation and destructiveness;the second analyzes the relationship between the three perspectives of the discussion: the crisis of capitalism, the pandemic and the environmental issue.
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The US military, intelligence, and diplomatic communities have overlooked a key vulnerability in their assessment of a potential military conflict between China and Taiwan- Taiwan's growing reliance on agricultural imports and its food stocks (except for rice) that could endure trade disruptions for only six months. This article assesses Taiwan's agricultural sector and its ability to feed the country's population if food imports and production are disrupted;identifies the food products that should be prioritized in resupply operations, based on Taiwan's nutritional needs and domestic food production;and outlines the required logistical assets. These findings underscore the urgency for US military planners to develop long-term logistical solutions for this complex strategic issue.
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O artigo analisa as iniciativas de promoção da segurança alimentar na Argentina, Brasil, Colômbia e Inglaterra a partir do desenho de um diagnóstico situacional dos países em questão, no período pós-Covid-19. São dados secundários recentes de agências de pesquisa locais e multilaterais que questionam a gama de indicadores de riqueza e pobreza versus insegurança alimentar entre a população mais vulnerável. Avança também no modo de produzir alimentos em larga escala, principalmente a economia baseada em commodities, questionando a soberania na produção de alimentos e a contradição com as premissas do desenvolvimento sustentável. Busca evidenciar a implementação de alguns programas e políticas sociais. Nesses países, para cuidar de famílias em situação de vulnerabilidade social.Alternate :El artículo analiza iniciativas para promover la seguridad alimentaria en Argentina, Brazil, Colombia e Inglaterra a partir del diseño de un diagnóstico situacional de los países en mención, en el periodo post-Covid-19. Se trata de datos secundarios recientes de agencias de investigación locales y multilaterales que cuestionan la gama de indicadores de riqueza y pobreza frente a la inseguridad alimentaria entre la población más vulnerable. También avanza sobre la forma de producir alimentos a gran escala, en especial la economía basada en commodities, cuestionando la soberanía en la producción de alimentos y la contradicción frente a las premisas para el desarrollo sostenible. Busca evidenciar sobre la implementación de algunos programas y políticas sociales. En los referidos países, para atender a las familias en situación de vulnerabilidad social.Alternate :The article analyzes the initiatives to promote food security in Argentina, Brazil, Colombia and England based on the design of a situational diagnosis of the countries in question, in the post-Covid-19 period. These are recent secondary data from local and multilateral research agencies that question the range of indicators of wealth and poverty versus food insecurity among the most vulnerable population. It also advances in the way of producing food on a large scale, mainly the economy based on commodities, questioning the sovereignty in food production and the contradiction with the premises of sustainable development. It seeks to highlight the implementation of some social programs and policies. In these countries, to care for families in situations of social vulnerability.
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In this paper, we investigate whether investors can reap potential diversification or hedging benefits from holding green bonds in a portfolio containing a conventional financial asset during the COVID-19 pandemic. Using data from 6 November 2014 to 5 November 2020, we estimate corrected dynamic conditional correlation between between green bonds and four major asset classes: stocks, corporate bonds, commodities, and clean energy. We extend our analysis by using these correlations to examine hedging, optimal portfolio weights, and naïve strategies and evaluate their implications for investors by calculating hedging effectiveness and utility gain improvement. Results reveal that across the full sample, pre-COVID-19, and during-COVID-19 periods, optimal portfolio weights represent an ideal strategy to realize the greatest risk reduction and risk-adjusted return. Further, green bonds could add substantial diversification benefits for investors holding assets in clean energy, global stocks, and commodities.
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This special issue consists of seven articles examining the impacts of the COVID-19 pandemic on the markets of selected commodities, including: seafood, lumber, crawfish, cattle/beef, fruits and vegetables in the USA, cotton and garments in Bangladesh, and fuel oil globally.
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This research explores gold's safe-haven properties amid oil price instability, focusing on the COVID-19 pandemic. The study examines how gold hedges against oil price swings in the context of the pandemic's exceptional market circumstances. A VAR (Vector Autoregressive) model analyzes gold and oil prices from 2006 through 2021. The VAR model reflects the dynamic interactions and interdependencies between these two essential commodities in the context of oil price volatility and the COVID-19 pandemic. This analysis shows that gold protects against oil price volatility and the COVID-19 pandemic-gold buffers against oil price swings due to its strong inverse association with oil prices. Gold offers investors security and asset preservation during significant oil price volatility. In light of oil price volatility and the COVID-19 pandemic, the study helps explain gold's importance as a diversification tool and haven asset. Investors, policymakers, and market players should consider gold as a hedge against oil price volatility and economic instability.
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We analyze the impact of COVID-19 vaccine announcements by leading vaccine companies on the financial and commodity markets from January to December 2020. We show that the vaccine announcements had varied and economically significant impacts on asset prices. The announcements moved interest rates, stock markets in the U.S. and numerous other countries as well as commodities used in transportation and some agricultural commodities. We show that the stock and commodity markets that experienced larger declines at the beginning of the pandemic receive a larger boost from good vaccine news. We also find that the vaccine news affects stock returns through changes in the expectations of the corporate cash flows and the expected equity risk premium. © 2023 The Eastern Finance Association.
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PurposeThis article unveils first the lead–lag structure between the confirmed cases of COVID-19 and financial markets, including the stock (DJI), cryptocurrency (Bitcoin) and commodities (crude oil, gold, copper and brent oil) compared to the financial stress index. Second, this paper assesses the role of Bitcoin as a hedge or diversifier by determining the efficient frontier with and without including Bitcoin before and during the COVID-19 pandemic.Design/methodology/approachThe authors examine the lead–lag relationship between COVID-19 and financial market returns compared to the financial stress index and between all markets returns using the thermal optimal path model. Moreover, the authors estimate the efficient frontier of the portfolio with and without Bitcoin using the Bayesian approach.FindingsEmploying thermal optimal path model, the authors find that COVID-19 confirmed cases are leading returns prices of DJI, Bitcoin and crude oil, gold, copper and brent oil. Moreover, the authors find a strong lead–lag relationship between all financial market returns. By relying on the Bayesian approach, findings show when Bitcoin was included in the portfolio optimization before or during COVID-19 period;the Bayesian efficient frontier shifts to the left giving the investor a better risk return trade-off. Consequently, Bitcoin serves as a safe haven asset for the two sub-periods: pre-COVID-19 period and COVID-19 period.Practical implicationsBased on the above research conclusions, investors can use the number of COVID-19 confirmed cases to predict financial market dynamics. Similarly, the work is helpful for decision-makers who search for portfolio diversification opportunities, especially during health crisis. In addition, the results support the fact that Bitcoin is a safe haven asset that should be combined with commodities and stocks for better performance in portfolio optimization and hedging before and during COVID-19 periods.Originality/valueThis research thus adds value to the existing literature along four directions. First, the novelty of this study lies in the analysis of several financial markets (stock, cryptocurrencies and commodities)' response to different pandemics and epidemics events, financial crises and natural disasters (Correia et al., 2020;Ma et al., 2020). Second, to the best of the authors' knowledge, this is the first study that examine the lead–lag relationship between COVID-19 and financial markets compared to financial stress index by employing the Thermal Optimal Path method. Third, it is a first endeavor to analyze the lead–lag interplay between the financial markets within a thermal optimal path method that can provide useful insights for the spillover effect studies in all countries and regions around the world. To check the robustness of our findings, the authors have employed financial stress index compared to COVID-19 confirmed cases. Fourth, this study tests whether Bitcoin is a hedge or diversifier given this current pandemic situation using the Bayesian approach.
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Su, B.;Guan, C.;An, Q., and Wang, Q., 2020. Analysis and countermeasures of the influence of COVID-19 on the commodity category of port export in China: Taking Shanghai Port as an example. In: Liu, X. and Zhao, L. (eds.), Today's Modern Coastal Society: Technical and Sociological Aspects of Coastal Research. Journal of Coastal Research, Special Issue No. 111, pp. 298–301. Coconut Creek (Florida), ISSN 0749-0208.Since the end of 2019, the novel coronavirus has spread rapidly, which has affected the economy, social interaction, and foreign trade, both in China and around the world. Import and export trade has become an organic part of China's national economy. Import and export trade accounts for nearly 35% of the national economy, which is a major part of China's economic growth. This article takes Shanghai Port as an example, collecting and analyzing the exporters of Shanghai Port in China from January to May 2020. Compared with the relevant data of the same period in 2019, this article discusses the major commodity categories that are affected by the epidemic situation in the export trade volume of Shanghai Port, giving countermeasures according to the influence situation in order to stabilize the quantity of this category in the future and reduce the risk of lower port trade volume of the export commodity categories affected by public health emergencies in China's port trade. At the same time, some suggestions and countermeasures are given to the ecological environment problems affecting the sustainable development of ports.
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Local decisions to contain pandemic can promote changes in markets over long distances, that is, commodity market consequences tend to be heterogeneous due to regional implications. It is trade-off between COVID-19 restrictions and regional economic activity level. Faced with supply chain disruptions, an exporting agricultural hub like Uberlandia region, Brazil, becomes more vulnerable to impacts caused by COVID-19. Thus, study objective was to analyze regional variables effect on price behavior of agricultural commodities resulting from global pandemic. Data include daily soybean and corn prices during the period between 2010 and 2020. The results indicate that coronavirus has impacted commodity prices variability, soybean and corn, through confirmed cases number. These results have important implications for commodities market, which suffers higher demand consequences with disruptions in supply, leading to higher returns on the part of investors. © 2023, Universidade de Taubate. All rights reserved.
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The shift to renewable sources of energy has become a critical economic priority in African countries due to energy challenges. However, investors in the development of renewable energy face problems with decision making due to the existence of multiple criteria, such as oil prices and the associated macroeconomic performance. This study aims to analyze the differential effects of international oil prices and other macroeconomic factors on the development of renewable energy in both oil-importing and oil-exporting countries in Africa. The study uses a panel vector error correction model (P-VECM) to analyze data from five net oil exporters (Algeria, Angola, Egypt, Libya and Nigeria) and five net oil importers (Kenya, Ethiopia, Congo, Mozambique and South Africa). The study finds that higher oil prices positively affect the development of renewable energy in oil-importing countries by making renewable energy more economically competitive. Economic growth is also identified as a major driver of the development of renewable energy. While high-interest rates negatively affect the development of renewable energy in oil-importing countries, it has positive effects in oil-exporting countries. Exchange rates play a crucial role in the development of renewable energy in both types of countries with a negative effect in oil-exporting countries and a positive effect in oil-importing countries. The findings of this study suggest that policymakers should take a holistic approach to the development of renewable energy that considers the complex interplay of factors, such as oil prices, economic growth, interest rates, and exchange rates.
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Despite this focus on pandemic-related supply chain disruptions, fewer empirical studies have sought to isolate short-term price impacts in food and nonfood agricultural commodity markets.1 Understanding the drivers of short-term commodity price impacts is critical to understanding future susceptibility to major market shocks and to informing policies related to shock mitigation. Declines in ethanol production reached an estimated 2 billion gallons lost from March to November 2020, leading to a corresponding decline of 700 million bushels of corn usage and a loss of billions of dollars of ethanol producer surplus (Renewable Fuels Association, 2020b;Schmitz, Moss, and Schmitz, 2020). Increases in corn-based ethanol production that started in 2005 have linked agricultural commodity prices and energy markets as US ethanol production increased rapidly from 3.9 billion gallons in 2005 to 13.3 billion by 2010 and 15.8 billion by 2019 (Chakravorty, Hubert, and Nøstbakken, 2009;Wright, 2011;Roberts and Schlenker, 2013;Asgari, Saghaian, and Reed, 2020;US Department of Agriculture, 2021). Given that over 90% of US ethanol is used in mixtures of E10 gasoline and the US market reached a 10% "blend wall" in 2016, any reduction in gasoline use will cause proportional decreases in ethanol use (US Energy Information Administrationa, 2020;US Department of Agriculture, 2021).
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We study time-scale co-movement of returns and implied volatilities of oil, gold, wheat, and copper in a multivariate setting using the wavelet local multiple correlation (WLMC) approach. Daily data cover January 03, 2007 – August 08, 2022, including the global financial crisis, COVID-19 pandemic, and Russia-Ukraine war. The results show that the correlations across the commodities are heterogeneous, less stable in the short-term, and more pronounced in the long-term, and vary in sign and magnitude. Despite market instability, contagion is not clearly seen in either return or volatility, reflecting noise trading and the importance of the individual characteristics of commodities.
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This paper is devoted to test agents' behavior in the markets of hard commodities by trying to distinguish between managing future price structures to hedge their positions and speculating in on prices. We do a triple analysis: cointegration on the time series, structural breaks over the full time series and panel data. The analysis of the full series and the identification of structural breaks allows us to discover the connection between high prices and the negative futures price structure (backwardation) in rising prices scenarios of tin, copper, aluminium, and zinc. Moreover, we obtain that the base metals full matrix (price and futures price structure) is cointegrated in our analysis that uses panel data methods. We believe that these results are important for agents in the markets, as commodity traders or brokers, to maximize profits in their hedging positions.
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We investigate stock market uncertainty spillovers to commodity markets using wavelet coherence and a general stock market-related Google search trends (GST)-based index to proxy for uncertainty. GST reflect stock market uncertainty over short-, medium-and long-term horizons. Periods of association between GST and the VIX, a widely used proxy for stock market uncertainty, coincide with economic, financial, and geopolitical events. The association between the VIX and GST has grown over time. In line with economic psychology, this implies that during times of heightened uncertainty investors increasingly search for stock market-related information. Our analysis further reveals that some commodities are more susceptible to uncertainty spillovers from stock markets, notably energy commodities. We demonstrate how GST may be used to isolate the impact of specific events and show that COVID-19 had a disproportionate impact on commodity price volatility. We also find that energy, livestock and precious metals are increasingly integrated with stock markets. Spillover analysis repeated using the VIX produces similar results and reflects information that is also reflected in GST, confirming an uncertainty narrative. The use of wavelet analysis and GST to proxy for general and event specific uncertainty offers an alternative perspective to traditional econometric approaches and may be of interest to econometricians, ana-lysts, investors and researchers.
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Purpose: This study aims to investigate the dependence structure and volatility spillovers among two strategic commodities (crude oil and gold) and a set of Islamic and conventional regional stock market indices, while examining the Ramadan effect Design/methodology/approach: The empirical strategy consists of two complementary measures of dependence and connectedness. This study first uses copulas to examine the dependency between the markets considered, then spillovers compute the magnitude of the connectedness among them. Findings: The copulas analysis shows that Frank's copula appears to better capture the relationship between most asset returns and highlights the almost absence of extreme dependence and, therefore, the existence of diversification opportunities. Moreover, the connectedness analysis suggests that gold is a net volatility receiver and provides, thereby, greater diversification benefits compared to crude oil. In addition, the high levels of time-varying connectedness support strong integration among the financial markets studied, specifically during the COVID-19 crisis period. Furthermore, the connectedness among the markets studied increases during the Ramdan subperiods, supporting shift contagion among financial markets considered during this religious holiday. Practical implications: The results provide investors with a better understanding of the nature as well as the magnitude of the interdependences between commodity markets and a set of Islamic and conventional regional stock markets. Indeed, it is of paramount importance for investors to clearly understand how Islamic and conventional markets are segmented or integrated during stress and stress-free periods, as well as the effect of the month of Ramadan on the interdependence among markets, to better assess risks, diversify portfolios and implement more effective hedging strategies. Originality/value: While a considerable body of literature examines financial contagion and volatility transmission between financial markets, there is still much to be said regarding connectedness among commodity and stock markets, particularly when it comes to studying the effects of religious holidays on the interaction between conventional and Islamic assets. This paper fills in this gap by focusing on the dependence structure as well as the connectedness between Islamic stock indices, conventional stock indices, gold and crude oil for six different regions, while examining the Ramadan effect. © 2023, Emerald Publishing Limited.
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El riesgo sistémico causado por el COVID-19 afectó a todos los sectores de la economía y con ello se denotó la vulnerabilidad de algunos sectores en comparación con otros. En este contexto, llamó la atención el choque de oferta experimentado por el sector minero, que, en consecuencia, se tradujo en una alta apreciación de los precios. Vinculado a esto, y con efectos negativos, se produjo en este periodo la devaluación de los precios del petróleo, explicada, entre otros factores, por la guerra de precios entre los países productores. En este sentido, el presente estudio analiza la volatilidad del indicador bursátil brasileño considerando los precios de los productos antes mencionados y la cotización del dólar. Los resultados muestran la importancia de la formación de precios de estos mercados en la variación del indicador de la Bolsa de Brasil, y la apreciación de los precios del petróleo y el mineral Brent cotizados en el mercado de minerales básicos de Dalian (China) deriva en que el indicador Ibovespa vaya en la misma dirección. Además, en términos estadísticos, el estudio destaca la gran importancia del precio de la moneda extranjera como determinante en la variación del indicador de Ibovespa y, consecuentemente, con efectos en la intención de inversión.Alternate :The systemic risk caused by COVID-19 affected all sectors of the economy, thus showing the vulnerability of some sectors in comparison to others. In this context, the supply shock experienced by the iron ore sector has drawn attention and resulted in a price increase. Linked to this, and in a negative way, oil prices fell due, among other factors, to the price war between producing countries. In this sense, this study analyses the volatility of the Brazilian stock market indicator in relation to the prices of the aforementioned products and the price of the dollar. The results show the importance of the price formation in these markets for the variation of the indicator. The appreciation of Brent oil and iron ore prices on the Dalian Commodity Exchange (DCE), in China, caused the Ibovespa indicator to move in the same direction. In addition, in statistical terms, the study highlights the great importance of the exchange rate as a determinant in the variation of the indicator and, consequently, affecting the intention to invest.