Assessing Interdependencies Between Food and Energy Prices: The Case of Biodiesel in Germany
Zuzana Lajdová, Jaroslav Kapusta, Peter Bielik
Agris on-line Papers in Economics and Informatics, No 3 /2017, September
Lajdová, Z., Kapusta, J. and Bielik, P. (2017) “Assessing Interdependencies Between Food and Energy Prices: The Case of Biodiesel in Germany", AGRIS on-line Papers in Economics and Informatics, Vol. 9, No. 3, pp. 51 - 59. ISSN 1804-1930.DOI 10.7160/aol.2017.090305.
The paper aims to analyse the relationship between energy prices (biodiesel, crude oil) and food commodities - vegetable oils used also as feedstock for biodiesel production. The econometric technique of price transmission, such as unit root test, cointegration test and vector error correction model, is applied to assess the interdependencies between energy prices and vegetable oil prices in Germany. Results suggest close price linkages between prices of vegetable oils and biodiesel and confirm that the vegetable oil prices drive the price dynamics of biodiesel. However, the simultaneous relationship is only revealed between biodiesel and soybean oil prices. The increase in crude oil prices is found to lead to an upward trend in the vegetable oils used for biodiesel production, thus influencing biodiesel prices as well.
Biodiesel, crude oil, food, Germany, price transmission.
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