Revisiting the palm oil boom in Southeast Asia: The role of fuel versus food demand drivers
In the last 30 years, palm oil production has known a ninefold increase, with almost all production growth concentrated in Malaysia and Indonesia. Several public reports have associated the palm oil boom with extensive deforestation, often pointing to the increase in biofuel demand in developed nations as a main driver of this phenomenon. Other demand drivers, especially as related to the food sector, have not been studied as much. In particular, regulations on genetically modified (GM) food in European nations and on trans fats in a number of developed countries have reportedly induced food companies to switch from soybean oil to palm oil and could therefore have contributed to additional demand for palm oil. This article provides a first analysis of the drivers of growth in palm oil production during the 1980–2010 boom, using a price dynamics analysis of the markets for palm oil, soybean oil, and crude oil. Soybean oil is selected as the leading vegetable oil in food markets, and crude oil is taken to represent the energy sector. We estimate two models of the oil price system: a vector auto regression model that treats all three prices as stationary and a vector error correction model that allows co-integration among the three prices.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
| Length: | |
| Date of creation: | 2012 |
| Date of revision: | |
| Handle: | RePEc:fpr:ifprid:1167 |
| Contact details of provider: | Postal: 2033 K Street, NW, Washington, DC 20006 Phone: 202-862-5600 Fax: 202-467-4439 Web page: http://www.ifpri.org/ Email: More information through EDIRC
|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Amsler, Christine & Lee, Junsoo, 1995. "An LM Test for a Unit Root in the Presence of a Structural Change," Econometric Theory, Cambridge University Press, vol. 11(02), pages 359-368, February.
- Sabuhoro, Jean Bosco & Larue, Bruno, 1997. "The market efficiency hypothesis: The case of coffee and cocoa futures," Agricultural Economics, Blackwell, vol. 16(3), pages 171-184, August.
- Gruere, Guillaume P., 2006. "A preliminary comparison of the retail level effects of genetically modified food labelling policies in Canada and France," Food Policy, Elsevier, vol. 31(2), pages 148-161, April.
- Kapetanios, George & Shin, Yongcheol & Snell, Andy, 2006. "Testing For Cointegration In Nonlinear Smooth Transition Error Correction Models," Econometric Theory, Cambridge University Press, vol. 22(02), pages 279-303, April.
This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.
When requesting a correction, please mention this item's handle: RePEc:fpr:ifprid:1167. 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: ()
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.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.