IDEAS home Printed from
   My bibliography  Save this article

Empirical analysis of corn and soybean basis in Canada


  • Getu Hailu
  • Alex Maynard
  • Alfons Weersink


The article examines the factors affecting the basis for corn and soybeans using several time-series techniques to account for potential structural breaks, seasonality, residual serial correlation and structural breaks, as well as potential endogeneity and nonstationarity. The spatio-temporal empirical framework is based on storage and trade theories which assume the relationship between nondelivery location's spot price and futures price of a storable commodity depends on opportunity cost of capital, warehousing costs, a convenience yield and shipping costs. The interest rate effect is strong for both crops with shipping costs also affecting soybean basis and own inventory levels positively correlated with corn basis. The effect of the wedge between the price of carrying physical grain and the maximum storage rate on basis is positive for both crops. The empirical results, which are robust to multiple estimators, provide stronger evidence of a structural break for the soybean basis than for the corn basis.

Suggested Citation

  • Getu Hailu & Alex Maynard & Alfons Weersink, 2015. "Empirical analysis of corn and soybean basis in Canada," Applied Economics, Taylor & Francis Journals, vol. 47(51), pages 5491-5509, November.
  • Handle: RePEc:taf:applec:v:47:y:2015:i:51:p:5491-5509
    DOI: 10.1080/00036846.2015.1051654

    Download full text from publisher

    File URL:
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. repec:ags:jlaare:267606 is not listed on IDEAS
    2. repec:taf:applec:v:49:y:2017:i:12:p:1213-1225 is not listed on IDEAS
    3. Adjemian, Michael K. & Marshall, Kandice K. & Hubbs, Todd & Penn, Jerrod, 2016. "Decomposing Local Prices into Hedgeable and Unhedgeable Shocks," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235874, Agricultural and Applied Economics Association.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:47:y:2015:i:51:p:5491-5509. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.