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The impacts of price insulation on world wheat markets during the 2022 food price crisis

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  • Martin, Will
  • Minot, Nicholas

Abstract

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-19 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.

Suggested Citation

  • Martin, Will & Minot, Nicholas, 2022. "The impacts of price insulation on world wheat markets during the 2022 food price crisis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(04), January.
    • Handle: RePEc:ags:aareaj:343032
    DOI: 10.22004/ag.econ.343032
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    Cited by:

    1. Nes, Kjersti & Schaefer, K. Aleks & Yu, Jisang, 2025. "Economic impacts of the Indian ban on non-Basmati rice exports," Food Policy, Elsevier, vol. 134(C).
    2. Martin, Will & Vos, Rob, 2024. "The SDGs and food system challenges: Global trends and scenarios toward 2030," IFPRI discussion papers 2237, International Food Policy Research Institute (IFPRI).
    3. Hoffmann, Clemens & Kastens, Lina & vPortugal-Perez, Alberto & von Cramon-Taubadel, Stephan, 2024. "Trade policies and the transmission of international to domestic prices," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344313, International Association of Agricultural Economists (IAAE).
    4. repec:ags:aaea22:335666 is not listed on IDEAS
    5. repec:ags:cfcp15:344313 is not listed on IDEAS
    6. Ajewole, Kayode & Zereyesus, Yacob Abrehe & Cardell, Lila & Sabala, Ethan & Majumdar, Inder, 2025. "Assessing the Recent Shift in the Price Relationship Between India’s and Global Grain Markets," Economic Research Report 356562, United States Department of Agriculture, Economic Research Service.
    7. Jayson Beckman & Noé J. Nava & Angelica S. Williams & Steven Zahniser, 2024. "Land competition and welfare effects from Mexico's proposal to ban genetically engineered corn," American Journal of Agricultural Economics, John Wiley & Sons, vol. 106(3), pages 1300-1325, May.
    8. Lenka Novotná & Zuzana Rowland & Svatopluk Janek, 2023. "Impacts of the war on prices of Ukrainian wheat," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 69(10), pages 404-415.
    9. Cai, Yan & Li, Yanyun & Lin, Faqin & Yan, Wenshou, 2025. "The direct and indirect effects of trade policy uncertainty on the volatility of world agricultural prices," Journal of Asian Economics, Elsevier, vol. 100(C).
    10. Yana Kostiuk & Paola Cerchiello & Arianna Agosto, 2025. "The Russo-Ukrainian War and Its Influence on Coal Markets: Event Study and Interconnectedness Analysis," DEM Working Papers Series 229, University of Pavia, Department of Economics and Management.
    11. Zereyesus, Yacob A. & Kee, Jennifer Y. & Morgan, Stephen N. & Hendricks, Nathan P. & Johnson, Michael E. & Cardell, Lila & Nava, Noé J. & Jelliffe, Jeremy L. & Ac-Pangan, Walter, 2023. "Does trade openness affect global grain supply response?," 2023 Annual Meeting, July 23-25, Washington D.C. 335666, Agricultural and Applied Economics Association.
    12. Mohamad B. Karaki & Andrios Neaimeh, 2024. "Do higher global oil and wheat prices matter for the wheat flour price in Lebanon?," Agricultural Economics, International Association of Agricultural Economists, vol. 55(4), pages 559-571, July.
    13. Mamun, Abdullah & Martin, Will & Minot, Nicholas, 2024. "Food trade policy and food price volatility," IFPRI discussion papers 2253, International Food Policy Research Institute (IFPRI).
    14. Daniel Hyun & Jacky Lee, 2023. "Variations in Pass-Through from Global Agricultural Commodity Prices to Domestic Food Inflation," Discussion Papers 2023-24, Bank of Canada.
    15. Laborde Debucquet, David & Mamun, Abdullah, 2024. "Role of international price and domestic inflation in triggering export restrictions on food commodities," IFPRI discussion papers 2246, International Food Policy Research Institute (IFPRI).

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