Showing papers on "Commodity published in 2008"

Optimal Pricing and Return Policies for Perishable Commodities

Abstract: This paper considers the pricing decision faced by a producer of a commodity with a short shelf or demand life. A hierarchical model is developed, and the results of the single period inventory model are used to examine possible pricing and return policies. The paper shows that several such policies currently in effect are suboptimal. These include those where the manufacturer offers retailers full credit for all unsold goods or where no returns of unsold goods are permitted. The paper also demonstrates that a policy whereby a manufacturer offers retailers full credit for a partial return of goods may achieve channel coordination, but that the optimal return allowance will be a function of retailer demand. Therefore, such a policy cannot be optimal in a multi-retailer environment. It is proven, however, that a pricing and return policy in which a manufacturer offers retailers a partial credit for all unsold goods can achieve channel coordination in a multi-retailer environment. This article was originally published in Marketing Science, Volume 4, Issue 2, pages 166--176, in 1985.

High food prices: The what, who, and how of proposed policy actions [In Chinese]

Abstract: "The complex causes of the current food and agriculture crisis require a comprehensive response. In view of the urgency of assisting people and countries in need, the first set of policy actions— an emergency package—consists of steps that can yield immediate impact: 1. expand emergency responses and humanitarian assistance to food-insecure people and people threatening government legitimacy, 2. eliminate agricultural export bans and export restrictions, 3. undertake fast-impact food production programs in key areas, and 4. change biofuel policies. A second set of actions—a resilience package—consists of the following steps: 5. calm markets with the use of market-oriented regulation of speculation, shared public grain stocks, strengthened food-import financing, and reliable food aid; 6. invest in social protection; 7. scale up investments for sustained agricultural growth; and 8. complete the Doha Round of World Trade Organization (WTO) negotiations. Investment in these actions calls for additional resources. Policymakers should consider mobilizing resources from four sources: the winners from the commodity boom among countries; the community of traditional and new donor countries; direct or indirect progressive taxation and reallocation of public expenditures in the affected countries themselves; and mobilization of private sector finance, including through improved outreach of banking to agriculture. Because of countries' diverse situations, the design of programs must be country driven and country owned. Accountability for sound implementation must also rest with countries. At the same time, a new international architecture for the governance of agriculture, food, and nutrition is needed to effectively implement the initiatives described, and especially their international public goods components. Global and national action is needed, through existing mechanisms, well-coordinated special initiatives, and possibly a special fund." from Text

Bringing the social context back in: governance and wealth distribution in global commodity chains

Abstract: This paper addresses recent changes in governance patterns that significantly altered power relations and wealth distribution in global commodity chains. First, it emphasizes the rise of a financial sphere made up of institutional investors and executives of large corporations at the top of GCCs, and discusses the consequences of this for supplier relations and working conditions of women workers at the base of GCCs. Second, by linking recent governance debates at the level of the firm to issues of governance of the whole chain, it identifies three distinct normative views (shareholder, stakeholder and institutional) of the ways in which the distribution of social welfare can be improved in GCCs. Beyond the shareholder and stakeholder views, a call is made for strengthening an institutional view of GCC governance.

A Handbook of Primary Commodities in the Global Economy

Abstract: List of figures List of tables Acknowledgements Introduction 1. The historical framework 2. The geography of commodity production and trade 3. Comparative advantage and the trade policy distortions 4. Price formation and price trends in primary commodities 5. The commodity exchanges, commodity investments and speculation 6. The economics of exhaustible resource depletion 7. Fears of and measures to assure supply security 8. Producer cartels in international commodity markets 9. Public ownership in primary commodity production 10. The monoeconomies. Issues raised by heavy dependence on commodity production and exports References Index.

Security: Collective Good or Commodity?

Abstract: The state monopoly on the legitimate use of violence in Europe and North America has been central to the development of security as a collective good. Not only has it institutionalized the state as the prime national and international security provider, it has helped to reduce the threat from other actors by either prohibiting or limiting their use of violence. The recent growth of the private security industry appears to undermine this view. Not only are private security firms proliferating at the national level; private military companies are also taking over an increasing range of military functions in both national defence and international interventions. This article seeks to provide an examination of the theoretical and practical implications of the shift from states to markets in the provision of security. Specifically, it discusses how the conceptualization of security as a commodity rather than a collective good affects the meaning and implementation of security in Western democracies.

South African trade policy matters Trade performance and trade policy

Abstract: South African trade policy has exerted a major influence on the composition and aggregate growth of trade. In the Apartheid period, trade protection seriously impeded both exports and imports, and the economy depended on favorable global commodity price trends to avoid running into an external constraint. South Africa developed a comparative advantage in capital-intensive primary and manufactured commodities partly because of its natural resource endowments but also because the pattern of protection was particularly detrimental to exports of non-commodity manufactured goods. High and opaque tariffs seriously impeded export growth. When global commodity markets were weak, in combination with declining gold exports, this seriously constrained aggregate growth and dulled the response of exports to the weaker rand in the late 1980s. On the other hand, surcharges were effective in reducing imports. By contrast, trade liberalization in the 1990s not only increased imports but, by reducing both input costs and the relative profitability of domestic sales, also boosted exports. The growth in non-commodity manufactured sectoral exports as a result of liberalization was actually faster than sectoral imports. This evidence suggests that additional trade liberalization could well be part of the strategy to enhance export diversification. It points to the importance of policies that afford South African firms with access to inputs at world prices as well as a competitive real exchange rate.

High Agricultural Commodity Prices: What Are the Issues?

Abstract: This report identifies the predominant factors behind the 2007/2008-crop-year market conditions for major agricultural commodities, with a focus on U.S. farm program crops. In addition, it briefly discusses how higher, more volatile commodity prices have impacted farm incomes, government farm programs, hedging activities, the livestock and food processing sectors, food prices, and the international food security situation. It reviews both the near- and longer-term commodity price outlook, and finally, it discusses various viewpoints and policy options that have been suggested as possible responses to the perceived causes and consequences of the unusually high commodity prices.

The Economics of Water Quality Trading

Abstract: Textbook pollution permit trading markets are appealing due to simple market designs and their ability to solve allocation problems without firm-specific information. Neither of these features is true for water quality markets, which may explain why emerging programs in this area have with few exceptions not fulfilled the promise of trading. We review water quality trading programs, and examine market design by focusing on three tasks that must be addressed to cost-effectively achieve environmental targets: (i) defining the point and nonpoint commodities to be traded, (ii) defining rules governing exchanges of the commodities, and (iii) setting caps on the commodity supplies so as to achieve an environmental target. Our examination of the third task, the cap and its role in determining trading rules (e.g., trading ratios), is novel. We examine this task from both an ecological and an economic perspective, and obtain new insights about the challenges of designing water quality trading programs.

The J-curve: evidence from commodity trade between UK and China

Abstract: China is often accused of manipulating its currency to gain international competitiveness. Previous studies have tried to address this issue by investigating the impact of yuan depreciation on China’s trade balance. Not only have they failed to establish the link between the Chinese exchange rate and its trade balance with the rest of the world but also between China and her major trading partners. In this article, we consider the China–UK trade balance and disaggregate their trade flows by commodity. Out of the 47 industries considered, we show that the real depreciation has favourable short-run effects in most industries. However, the short-run effects last into the long run only in seven cases.

Rice policy in indonesia: a special issue

Abstract: Rice is Indonesia's single most important commodity: almost all of her 220 million people consume it, and for most it is the staple food. Rice is also an important part of the rural economy: althou...

From scotch whisky to chinese sneakers: international commodity flows and new trade networks in oshikango, namibia

Abstract: After the end of the colonial period, international commodity flows into Africa at first continued to reproduce patterns of colonial domination. In the last ten years, however, important shifts have become visible. New commodity chains bypassing the old colonial powers have developed and are changing the way Africa is integrated into the global economy. This article looks at four trade networks that converge in Oshikango, a small trade boom town in northern Namibia. It describes how trade in Scotch whisky, Brazilian furniture, Japanese used cars and Chinese sneakers into Oshikango is organized. Whisky trade follows old colonial patterns; furniture trade relies on new South-South business contacts backed by political lobbying; in the used car trade, goods from the North are traded by networks of Southern migrant entrepreneurs; Chinese consumer goods are brought into Africa by Chinese migrants who bridge the cultural gap between the markets. Trade in Oshikango highlights the importance of new trade routes for Africa. Migrant entrepreneurs play an important role in these trade routes. A closer look at them shows, however, that their importance is largely due to opportunities arising from their place in the international system, not to a group's inherent cultural or social characteristics.

Rural Commercial Capital: Agricultural Markets in West Bengal

Abstract: Commodity markets are at the heart of development and understanding them is a necessity. Through unique field research over the last quarter century, this book examines the political economy of markets for staple foods in West Bengal. From serious food deficit to rice bowl of India, the Left Front government implemented a set of celebrated reforms to production but the food markets remained untouched until the late 1990s, as a result reformed agrarian structure interacted with an unreformed marketing system. This volume traces the result both before and after liberalization This lucidly written book breaks the traditional way of looking at the agricultural system through a) ownership patterns, and b) inter-linked contracts of trade. These two systems not only help understand markets but also about how agriculture is organized in India. It is the first study to conceive of the post-harvest sector as a system of markets. While analysing the informal community financing system the book also weaves into it the role of ethnicity, caste, and clan in market operations. This helps the reader to understand commodity markets. The importance of availability of credit to petty traders and post-harvest trade channels brings to light a very important gap in policymaking and available literature where the focus was always on credit for cultivation only. It shows how political economy may be used to contribute constructively to development policy. The volume is the first to examine regulation-both by the state and by means of institutions of social identity. It pioneers the study of self-regulation of markets through institutions of collective action.

Towards domestic fair trade? Farm labor, food localism, and the 'family scale' farm

Abstract: Over the past several decades, consumers in the global North have increasingly looked to fair or alternative trading systems as a means to promote ecologically and socially sustainable agricultural production. While fair trade has historically been limited to international commodity networks, US-based agro-food activists have recently turned their attentions towards building a domestic movement, to bring fair trade principles and standards ‘home.’ Through an exploration of this growing movement, we consider the potential for third party certification and labeling to incorporate social justice into US-based agricultural production, with a particular focus on the implications for farm workers. We view current efforts to bring the principles of fair trade to the domestic arena as a reflection of several interrelated developments: a growing need on the part of small and mid-sized farmers to garner price premiums due to the erosion of the organic price premium; a recognition of the failure of organic certification to advance a holistic vision of sustainability; and the strategic embrace of voluntary regulatory mechanisms as an alternative to public regulation and collective bargaining. Initial research suggests that this has led to particular framings of the domestic fair trade concept, which may undermine the movement’s ability to address the social relations of agro-food production. Specifically, prioritization of the ‘family-scale’ farm and an undercurrent of food localism may obscure farm workers’ role in valorizing the US agricultural landscape.

Liberalisation of tropical commodity market and adding-up problem: a bound test approach

Abstract: The paper examines the effect of commodity market liberalisation on developing countries by taking the case of tropical products. This issue assumes importance in the context of developing countries characterised as they are by heavy dependence on commodity exports. Theoretically, commodity market liberalisation could adversely affect the terms of trade of exporting countries, as the price and income elasticity of demand for the commodities are relatively low. The problem arises as the welfare effects of unilateral liberalisation by an individual country having a small market share differ from the multilateral liberalisation by a group of producing countries who collectively constitute a major share of the market. This collective liberalisation in most of the cases can result in a decline in prices. In this paper we examine this phenomenon the adding up problem- using Bound Test Procedure which is an advanced approach for testing the existence of long run relationship. The major finding of the study is that along with product specificities, export structure of the countries concerned is also an important factor in determining the adding up problem.

Telecommunication Infrastructure Development and Economic Growth: A Panel Data Approach

Abstract: World is going to be global village due to the introduction of new and advanced technology and new innovations in technology make it more possible day by day. The widely spread economic activities both in real as well as in credit market is possible when they use advance technology to communicate. This is a fact that the world is rapidly moving towards an economic system based on the continuous and ubiquitous availability of information. Developing countries try to maintain and develop their technology in such a way that they can become a part of this global village. Recent developments in telecommunication technology have been an important tool to exchange the information to develop a sharp and valuable commodity market. During 21st century to move into post-industrial, information based economic growth, countries and sector try to equip themselves with the necessary telecommunication system. A modern telecommunication infrastructure is not only important for economic growth but also to connect domestic market of commodities as well as credit with international commodity and financial markets. This would develop the smooth flow of foreign investment, positive value of net exports, increase the value addition in GDP of an economy etc. Once the industrial and agriculture development was considered to be a best tool to enhance economic growth of a country, every country gave more importance to these sectors in its plans and policies, but now the trend has changed because the advancement and development of these two major sector of an economy sustain on the development of other factors, the role of service sector, advancement in technology, and the contribution of foreign sector in economic growth by different ways increases, and the major area of interest for foreign sector or investment was service sector and still it is, countries with the existence of GATS, started to privatise their set up, and after realising the importance of communications, the telecommunication sector is now on their main priorities. With the advancement of telecommunication services, a new market mechanism, low cost structure and expanded value chain of firms is possible [Kambil and Short (1994)], on other hand in developing countries, the average price of agricultural commodities is high in the area where there is telephone facilities available than the area where there is no facilities to communicate [Bayes, et al. (1999)].

Copper Mining Agreements in Zambia: Renegotiation or Law Reform?

Abstract: Poverty levels in Zambia are historically associated with development in the mining sector. As long as the sector was performing well and enjoying high international prices for copper, the revenues to government were high and the government could afford the provision of, for example, public health. It is however paradoxical that in the current upturn of commodity prices, the Zambian government has not obtained sufficient revenues to enable it to provide the required public goods. Close scrutiny of the way the state‐owned mining company, Zambia Consolidated Copper Mines (ZCCM), was privatised in the late 1990s reveals that the agreements made between the government and the new mining companies were lopsided. As a consequence, the government has been unable to earn revenues to the same extent as countries like Chile prompting civil society to pressure the government to renegotiate the agreements. The government has, however, chosen the path of law reform to increase the taxation on foreign‐owned mining comp...

The Impact of Export Restraints on Rising Grain Prices

Abstract: Commodity prices in maize and wheat have risen by more than 50 percent since 2006 While much of this increase reflects increasing demand and some constraints on supply, another factor contributing to the rising prices is the export restraints implemented by major grain exporting countries, such as China, Ukraine, and Argentina While these measures are intended to keep domestic prices low, they tighten global supply and put upward pressure on prices for importers This report presents quantitative evidence of the impact of export restrictions on the global agricultural market by evaluating these recent cases of export restraints using available monthly and annual trade data When an exporting country enacts restrictive measures, their importing partners must often purchase grain from other exporters, causing more intense competition for the remaining available supplies The impact of export restraints in these cases suggests that governments should use them cautiously

Distributional and Risk Reduction Effects of Commodity Revenue Program Design

Abstract: O of the purposes of U.S. agricultural programs has been to support or stabilize farm incomes by mitigating the effects of low crop prices and yields. Commodity programs such as the counter-cyclical payment and Marketing Loan programs have provided benefits or made payments to producers of several major field crops when crop prices fall short of expected or target levels. At the same time, the federal crop insurance program has provided support that has focused on yield shortfalls but has increasingly included revenue coverage. Several proposals to reform U.S. commodity programs have received attention in the 2007 farm bill debate (American Farmland Trust; National Association of Corn Growers; USDA). Generally, these proposals would alter or replace commodity price programs with programs that would make payments when revenues, that is, prices multiplied by yields, fall short of expected or target levels (Coble, Dismukes, and Thomas). Interest in revenue as the basis for farm programs is not new. In 1983, a national-level revenue program was studied as a way to control federal outlays for commodity programs (CBO). In the early 1990s, a regional-level revenue program was analyzed as a way to mitigate the need for supplemental, ad hoc disaster payments (Miranda and Glauber). More recently, a county-level revenue guarantee program has been promoted as providing protection when it is needed while reducing the chances that annual payments would exceed domestic commodity support limits allowed under the World Trade Organization Agreement on Agriculture (Babcock and Hart).

Fiscal Positions in Latin America: Have They Really Improved?

Abstract: Fiscal performance in Latin America looks much improved this decade compared to the 1980s or 1990s. Is this a "structural" improvement or likely to be transitory? This paper answers this question by estimating the relationship between non-commodity revenue and the economic cycle, and evaluating commodity revenues using alternative medium term commodity price projections. The main result is that structural revenues have indeed improved as a share of GDP, and structural primary balances are currently in surplus in many Latin American countries. However, the magnitude of these improvements is uncertain, in part due to uncertainty about the commodity price outlook.

Electric commerce website related products recommendation system and method

Abstract: The invention discloses a corresponding commodity on electronic business websites recommendation system which mines characteristic words from the historical purchasing data and purchasing contents of customers, builds similar relations of different eigenvectors by mathematical methods, acquires the similar relations of commodities and thus finds the suitable commodities for customers. The invention also discloses a recommendation method of corresponding commodities which comprises the following steps of: extracting data of a certain time span from the database, choosing and calculating the useful data information segment to build a 'commodity-customer' calculating model, calculating the similarity degree of commodities according to the commodity-customer-other commodities model, and recommending the results to the customers. The invention has the advantages of grasping the mentality of customers, encouraging the customers to purchase corresponding commodities and thus promoting the sales volume.

Method and system for selecting optimal commodities based upon business profile and preferences

Abstract: A system and method for assisting a customer in choosing a combination of commodities based on preferences of the customer. A combination is a set of related commodities, wherein bundling discounts may be applied to particular bundles of related commodities. Combination options are created by optimizing the categories within the combination in parallel, and then selecting the best value options from each category into a grouping. The effective cost of a grouping is calculated as a total of the effective costs of each option within the grouping. The effective costs consider weighted values of performance features in addition to the actual cost of a commodity. The groupings are ranked and presented to the user, so that the user may select a grouping as combination of commodities for purchase.

Risk Management in Islamic Finance: An Analysis of Derivatives Instruments in Commodity Markets

Abstract: This study addresses the derivatives instruments in Islamic finance and highlights their benefits and legal aspects. It also discusses the forward, futures and options contracts in commodity markets. Arguments both in favour of and against these instruments are addressed and several alternatives are examined as well.

Supply chain management system

Abstract: A method of transporting commodities in a supply chain management system including a supply chain. The method includes providing a database and a network in communication with the database, which is accessible by at least one member of the supply chain via the network. The method also includes providing a container and supporting one or more commodities using the container, assigning at least one sensor to the commodities, sensing a condition of the commodities and generating a signal indicative of the commodity condition, identifying information related to the commodities, acquiring data related to identifying the commodity information, distributing the signal and the acquired data over the network, storing the signal and the acquired data in the database, monitoring the commodities via the network, and managing at least one of storage and transport of the commodities through the supply chain based on the signal and the acquired data.