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Price transmission of melons (cucumis melo and citrullus lanatus) in Myanmar – China border trade

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  • Lwin, Wuit Yi
  • Brorsen, Wade
  • Henneberry, Shida Rastegari

Abstract

Border trade is the main export channel for agricultural products from Myanmar (formerly Burma). With an increasing quantity and value of exports during the last few decades, melons have become one of the major crops in the national export strategy of Myanmar. In this paper, the word “melons” is used to represent both watermelon (Citrullus lanatus) and muskmelon (Cucumis melo) cultivars. No previous research exists on price transmission between these countries, especially for the horticultural produce market. This study aims to measure the magnitude and speed of spatial price adjustment in melons exported from Myanmar to China. Price transmission in the melon export market in Myanmar is analyzed by studying the lead-lag relationship among prices in the border market in Myanmar and the selected wholesale markets in Beijing, China, using a vector autoregressive model (VAR). Prices are transmitted quickly from Myanmar to the selected wholesale markets in Beijing, China. The wholesale market price in Beijing, China lags only one day behind the Myanmar price. In the Myanmar border market, the melon price is affected only by its own lagged price. The adjustment of melon prices in one day suggests that market information is getting passed up the market channel, and there does not appear to be a need for a policy to improve market efficiency.

Suggested Citation

  • Lwin, Wuit Yi & Brorsen, Wade & Henneberry, Shida Rastegari, 2022. "Price transmission of melons (cucumis melo and citrullus lanatus) in Myanmar – China border trade," Journal of Agribusiness and Rural Development, University of Life Sciences, Poznan, Poland, vol. 65(3), March.
    • Handle: RePEc:ags:pojard:356198
    DOI: 10.22004/ag.econ.356198
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    1. Dennis Bergmann & Declan O’Connor & Andreas Thümmel, 2016. "An analysis of price and volatility transmission in butter, palm oil and crude oil markets," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 4(1), pages 1-23, December.
    2. Byeong-il, Ahn & Lee, Hyunok, 2015. "Vertical Price Transmission of Perishable Products: The Case of Fresh Fruits in the Western United States," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 40(3), pages 1-20, September.
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