Agric. Econ. - Czech, 2024, 70(1):12-23 | DOI: 10.17221/308/2023-AGRICECON

The impact of fluctuating international fertiliser prices and exchange rates on domestic fertiliser prices in TürkiyeOriginal Paper

Ozgur Bor ORCID...1, Nihat Dagistan ORCID...1
1 Department of International Trade and Finance, Faculty of Commercial Sciences, Baskent University, Ankara, Türkiye

This study aims to examine the relationship between domestic and international prices of di-ammonium phosphate (DAP) and urea fertilisers together with exchange rates in Türkiye using the non-linear autoregressive distributed lag (NARDL) model on monthly data for the period of January 2011 to September 2022. The result of the study provides empirical evidence about the presence of asymmetries in the short and long-run among these fertilisers. The findings of the study confirm that international prices of di-ammonium phosphate and urea fertilisers have a symmetric effect in the long-run and exchange rate of the Turkish lira to US dollars has an asymmetric effect on the domestic prices of fertilisers in the short run. This is the first study in Türkiye to delineate the dynamic simultaneous interaction among these markets and its findings can be extremely useful for academicians, and policymakers to make decisions regarding the market structure of countries that do not have sufficient domestic resources for fertiliser supply and are dependent on imports.

Keywords: di-ammonium phosphate; NARDL; price and exchange rate transmission; urea

Received: September 14, 2023; Revised: December 5, 2023; Accepted: December 11, 2023; Published: January 29, 2024  Show citation

ACS AIP APA ASA Harvard Chicago Chicago Notes IEEE ISO690 MLA NLM Turabian Vancouver
Bor O, Dagistan N. The impact of fluctuating international fertiliser prices and exchange rates on domestic fertiliser prices in Türkiye. Agric. Econ. - Czech. 2024;70(1):12-23. doi: 10.17221/308/2023-AGRICECON.
Share...
Download citation
  • BibTeX (.bib)
  • Bookends (.ris)
  • EasyBib (.ris)
  • EndNote (.enw)
  • EndNote 8 (.xml)
  • ISI WoS (.isi)
  • Medlars (.medlars)
  • Mendeley (.ris)
  • MODS (.xml)
  • Papers (.ris)
  • RefWorks (.txt)
  • RefManager (.ris)
  • RIS (.ris)
  • MS Word (.xml)
  • Zotero (.ris)
    • Open full article

    References

    1. Alemu Z., Jooste A., Louw C. (2011): Price transmission between international and local fertilizer prices: The case of South Africa. In: 21st Annual Food and Agribusiness Management (IFAMA) Symposium, Frankfurt, June 20-23, 2011: 1-38.
    2. Alexander P., Arneth A., Henry R., Juilette M., Rabin S., Rounsevel M.D.A. (2023): High energy and fertilizer prices are more damaging than food export curtailment from Ukraine and Russia for food prices, health and the environment. Nature Food, 4: 84-95. Go to original source... Go to PubMed...
    3. Arndt C., Diao X., Dorosh P., Pauw K., Thurlow J. (2023): The Ukraine war and rising commodity prices: Implications for developing countries. Global Food Security, 36: 100680. Go to original source... Go to PubMed...
    4. Beckman J., Riche S. (2015): Changes to the natural gas, corn, and fertilizer price relationships from the biofuels era. Journal of Agricultural and Applied Economics, 4: 494-509. Go to original source...
    5. Bouri E., Jain A., Biswal P.C., Roubaud D. (2017): Cointegration and nonlinear causality amongst gold, oil, and the Indian stock market: Evidence from implied volatility indices. Resources Policy, 32: 201-206. Go to original source...
    6. CBRT (2023): Exchange rates. Available at https://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/Main+Menu/Statistics/Exchange+Rates (accessed July 15, 2023)
    7. De Nicola F., De Pace P., Hernandez M.A. (2016): Co-movement of major energy, agricultural, and food commodity price returns: A time-series assessment. Energy Economics, 57: 28-41. Go to original source...
    8. Dickey D.A., Fuller W.A. (1979): Distribution of the estimators for autoregressive time series with a unit root. Journal of the American Statistical Association, 74: 427-431. Go to original source...
    9. Emam A. (2023): Saudi fertilizers and their impact on global food security: Present and future. Sustainability, 15: 7614. Go to original source...
    10. Etienne X.L., Trujillo-Barrera A., Wiggins S. (2016): Price and volatility transmissions between natural gas, fertilizer, and corn markets. Agricultural Finance Review, 76: 151-171. Go to original source...
    11. Fowowe B. (2016): Do oil prices drive agricultural commodity prices? Evidence from South Africa. Energy, 104: 149-157. Go to original source...
    12. Gardebroek C., Hernandez M.A. (2013): Do energy prices stimulate food price volatility? Examining volatility transmission between US oil, ethanol and corn markets. Energy Economics, 40: 119-129. Go to original source...
    13. IndexMundi (2023): Commodity prices. Available at www.indexmundi.com/commodities/ (accessed June 28, 2023)
    14. International Fertilizer Association (IFA) (2023): Databases. Available at https://www.ifastat.org/databases (accessed June 20, 2023)
    15. Kocaarslan B., Soytas U. (2019): Dynamic correlations between oil prices and the stock prices of clean energy and technology firms: The role of reserve currency (US dollar). Energy Economics, 84: 104502. Go to original source...
    16. Konyali S. (2016): Fertilizer production and policies in Turkey (Türkiye'de gübre üretimi ve uygulanan politikalar). 12. Tarim Ekonomisi Kongresi, 3: 2041-2048. (in Turkish).
    17. Kumar S., Choudhary S., Singh G., Singhal S. (2021): Crude oil, gold, natural gas, exchange rate and Indian stock market: Evidence from the asymmetric nonlinear ARDL model. Resources Policy, 73: 102194. Go to original source...
    18. Lahiani A., Hammoudeh S., Gupta R. (2016): Linkages between financial sector CDS spreads and macroeconomic influence in a nonlinear setting. International Review of Economics and Finance, 43: 443-456. Go to original source...
    19. Liu Z., Ding Z., Li R., Jiang X., Wu J., Lv T. (2017): Research on differences of spillover effects between international crude oil price and stock markets in China and America. Nature Hazards, 88: 575-590. Go to original source...
    20. Ministry of Agriculture and Forestry (2023): Fertilizer statistics. Available at https://www.tarimorman.gov.tr/Konular/Bitkisel-Uretim/Bitki-Besleme-ve-Tarimsal-Teknolojiler/Bitki-Besleme-Istatistikleri (accessed July 14, 2023; in Turkish).
    21. MMB (2023): Monthly meat and input prices (Yillara göre aylik et ve girdi fiyatlari). [Unpublished dataset]. (in Turkish)
    22. Nazlioglu S., Soytas U. (2012): Oil price, agricultural commodity prices, and the dollar: A panel cointegration and causality analysis. Energy Economics, 34: 1098-1104. Go to original source...
    23. Nazlioglu S., Erdem C., Soytas U. (2013): Volatility spillover between oil and agricultural commodity markets. Energy Economics, 36: 658-665. Go to original source...
    24. Pesaran M.H., Shin Y., Smith R.J. (2001): Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16: 289-326. Go to original source...
    25. Phillips P.C., Perron P. (1988): Testing for a unit root in time series regression. Biometrika, 75: 335-346. Go to original source...
    26. Reboredo J.C. (2012): Do food and oil prices co-move? Energy Policy, 49: 456-467. Go to original source...
    27. Shin Y., Yu B., Greenwood-Nimmo M. (2014): Modelling asymmetric cointegration and dynamic multipliers in a nonlinear ARDL framework. In: Sickles R.C., Horrace W.C. (eds): Festschrift in Honor of Peter Schmidt: Econometric Methods and Applications. New York, Springer: 281-314. Go to original source...
    28. Tagem (2018): Fertilizer Sector Policy Document (Gübre Sektör Politika Belgesi). 2018-2022. Ankara, TOB: 100. Available at https://www.tarimorman.gov.tr/TAGEM/Belgeler/yayin/Gübre%20Sektör%20Politika%20Belgesi%202018-2022.pdf (accessed June 15, 2023; in Turkish)
    29. Uçak H., Ari Y., Yelgen E. (2022): The volatility connectedness among fertilizers and agricultural crop prices: Evidence from selected main agricultural products. Agricultural Economics - Czech, 68: 348-360. Go to original source...

    This is an open access article distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International (CC BY NC 4.0), which permits non-comercial use, distribution, and reproduction in any medium, provided the original publication is properly cited. No use, distribution or reproduction is permitted which does not comply with these terms.


    Return to the content