Abstract
The causal basis for many of the relationships in models used to estimate the indirect effects of U.S. biofuels on global agricultural markets has not been adequately established. This paper addresses this gap by examining causal interactions among corn market variables through which the indirect effects of U.S. corn use for ethanol would be transmitted. Specifically, structural break and causal analyses of U.S. corn supply, uses, trade, and price are performed using quarterly data for marketing years 1986 to 2017. The structural break analysis identifies three breaks in corn use for ethanol that reflect the policy-driven evolution of U.S. corn ethanol production and other market factors. The causality analysis finds that U.S. corn use for ethanol is not a driver of the corn price and net corn exports. Changes in corn supply and domestic corn use are found to be the key factors in accommodating the large increase in corn use for ethanol between 2003 and 2010. These results mean that common assumptions linking U.S. corn ethanol production to large reductions in corn availability and exports, and higher global corn prices merit reconsideration.
| Original language | English |
|---|---|
| Article number | 267 |
| Journal | Agriculture (Switzerland) |
| Volume | 11 |
| Issue number | 3 |
| DOIs | |
| State | Published - Mar 2021 |
Funding
Copyright Notice: This manuscript has been authored by UT-Battelle, LLC under Contract No. DE-AC0500OR22725 with the U.S. Department of Energy. The United States Government retains and the publisher, by accepting the article for publication, acknowledges that the United States Government retains a non-exclusive, paid-up, irrevocable, world-wide license to publish or reproduce the published form of this manuscript, or allow others to do so, for United States Government purposes. The Department of Energy will provide public access to these results of federally sponsored research in accordance with the DOE Public Access Plan (http://energy.gov/downloads/doe-public-accessplan). The efforts of Gbadebo Oladosu and Keith Kline were funded was funded by the U.S. Department of Energy, Bioenergy Technology Office. The contribution of J.W.A.L was funded under International Energy Agency (IEA) Bioenergy Technology Collaboration Programme, Task 43.The authors would like to acknowledge and express their appreciation to the U.S. Department of Energy, Bioenergy Technology Office. Thanks to two anonymous reviewers who provided valuable comments on the manuscript. We also thank Rocio Uria-Martinez for her review of the final pre-submission version of the manuscript, as well as collaborators under the IEA Bioenergy Task 43 for their support (Mudit. Chordia, Miguel Brandão, Annette Cowie). Conflicts of Interest: The authors declare no conflict of interest.
Keywords
- Biofuels
- Causality
- Corn ethanol
- Indirect land use effects
- Structural breaks