Doctor of Philosophy / Department of Agricultural Economics / Jason S. Bergtold / Tian Xia / Brazil is one of the leading producers of ethanol, sugar, and sugarcane. Increasing demand for biofuels aligned with public policies prompted the expansion of sugarcane into the Brazilian Cerrado, particularly, into the states of Goiás and Mato Grosso do Sul. The overall purpose of this dissertation, comprised of three essays, is to understand the impacts from the sugarcane expansion on farmers, processors, and the market. At the market level, the first essay, estimates the impacts of public policies and market factors on ethanol and sugar, supply and demand, in Goiás and Mato Grosso do Sul, using three-stage least squares. Results show that ethanol supply is sensitive to public policies whereas the sugar supply is sensitive to market prices. Sugar and ethanol were found to be complementary outputs. For ethanol expansion to be sustainable the ethanol market must be developed to the extent that it relies on market factors and is no longer dependent on public policies. At the farmer level, the second essay, examines farmers' willingness to sign a sugarcane contract with a mill in the Brazilian Cerrado. A hypothetical stated choice experiment was conducted with farmers in Goiás and Mato Grosso do Sul. Respondents choose between three contracts (land rental, agricultural partnership and supply) and two optout options ("keep current contract" or "not grow sugarcane"). A single and a two opt-out random parameters models were estimated. The two opt-out model allowed for a better interpretation of the status quo. Willingness to pay, direct and cross-elasticity measures for contract attributes were calculated. Results showed that farmers prefer contracts with higher returns, shorter duration and a lower probability of late payments. Farmers seemed to prefer to renting out their land to the mill than to produce sugarcane themselves, which could lead to consequences for rural development and the sustainability of sugarcane expansion. At the processor level, the third essay investigates the impact of vertical coordination on input-oriented technical efficiency using data envelopment analysis (first stage) and a Tobit censored model (second stage). 204 Brazilian mills were considered. The second stage controlled for vertical integration as well as other characteristics of the mill. Vertical integration was measured as the percentage of total sugarcane used, supplied by mills. A negative, though minimal, relationship between vertical integration and technical efficiency was found. Hence, technical efficiency is not the major driver of vertical integration. Other vertical coordination strategies may bring more benefits in terms of technical efficiency (e.g. contracts). Drivers of vertical integration seem to vary according to the characteristics of the location of the mill.

The Federal Reserve has increased nominal interest rates since early 2016. It is expected that commodity prices will drop in response to this monetary intervention. The overshooting hypothesis explains that commodity prices are more flexible than manufacturing prices and therefore are more volatile. In this situation, it is expected that agricultural commodities decline significantly (i.e., overshoot) and gradually return to their long-run equilibrium. This adjustment behavior has implications for income stability and financial viability of farmers. This research contributes to the overshooting literature by including the energy sector in the overshooting model. The interlinks between energy and other sectors in the economy as well as the vast resource allocation to biofuel production in recent decades demand more attention to the impact of energy on the dynamic adjustment path of relative prices’ reaction to monetary shocks. We assume energy prices have independent adjustment path and include the links between the energy and agricultural sectors through biofuel production in our model. Our theoretical model shows that by including energy prices in the model, agricultural prices and the exchange rate overshoot less than the prediction of prior studies. This happens because we expect that flexible energy prices share the burden of the shock with other flexible prices in the model. We also describe how an increasing share of biofuels in the total fuel consumption will reduce the flexibility of energy prices. In our empirical analysis, we use monthly data from January 1975 to December 2017 for three producer price indexes (i.e., agricultural commodities, energy, and industrial goods), exchange rates, and money supply to test the overshooting hypothesis. We found the series to be nonstationary and cointegrated of the order one, I(1). Thus, we estimated a vector error correction model to identify the short run adjustment parameters while maintaining the long-run relationships between the variables. We identify and control for three possible structural breaks in the data that coincide with two economic crises and the biofuel production era. We also estimated the empirical model using a sub-sample from January 1975 to March 1999 and compared the results with the findings in previous studies. Our empirical results confirm the theoretical expectation that agricultural commodities adjust faster than manufacturing prices. The analysis of the impulse response functions shows that after a money supply shock, agricultural prices were the most responsive, followed by energy prices and exchange rates. In both full sample and the sub-sample, the volatility of prices and exchange rates happen during the first 5 to 10 months. The sluggish adjustment of manufacturing prices was evident from the corresponding impulse response functions. The empirical evidence rejects the long-run money neutrality, consistent with the findings of previous empirical studies. Compared to previous models, our empirical model shows that including energy prices will reduce the extent to which agricultural commodities overshoot. Therefore we expect the disturbances to the farm income variability, in response to monetary policy, to be less than what prior model would have estimated. In this regard, energy prices are a stabilizing factor in this model. We find that increased share of biofuel from total fuel consumption would positively affect the overshooting of agricultural prices. So, higher biofuel mandates could reduce the flexibility of the energy prices and therefore have an adverse effect on the farm price stability.

No description available.

This diploma thesis focuses on the analysis of scientific literature and the current situation in the field of energy crops and world food prices and trying to express the contemporary situation in this area through discourse. It seeks to analyse the relationship between the production of technical and energy crops in relation to the production of food commodities, world food prices and the anticipated growth of the world's population. Analysis of secondary statistical data of selected productions of food commodities in the last 5 years and their comparison with the prices of selected technical and energy crops are trying to define the direct and indirect links between the development of prices of these commodities.

No description available.

I det här examensarbetet har utvecklingen av den svenska politiken kring biodrivmedel under perioden 1975–2020 undersökts. Detta i syfte att öka förståelsen för de politiska motiv som legat till grund vid utformningen av politiska styrmedel samt hur sambanden mellan styrmedel och biodrivmedelsproduktion utvecklats. I rapporten ingår granskningen av de propositioner och underlagsrapporter som varit grund till svenska styrmedel riktade mot biodrivmedel. Styrmedelsförslagen har beskrivits och vissa skillnader mellan underlagsrapporter och slutgiltigt förslag har diskuterats. De motiveringar och politiska mål som hänvisas till i styrmedelsförslagen har satts i en bredare kontext för att beskriva hur utvecklingen sett ut. Utvecklingen av biodrivmedelsmarknaden har samtidigt undersökts med hjälp av Energimyndighetens årliga rapporter samt årsredovisningar och offentliga uttalanden från de största biodrivmedelsproducenterna. Vad denna genomgång visat är att biodrivmedel använts som ett medel för att minska användningen av fossilbaserad bensin och diesel för att nå målen inom ett flertal olika politikområden. I början av tidsperioden var det främsta målet att öka den svenska energiförsörjningstryggheten, det målet kompletterades sedan med mål om att minska hälso- och miljöskadliga utsläpp. Att minska utsläppen av växthusgaser började sedan bli allt mer prioriterat och har under de senaste 20–30 åren varit det främsta målet. Vilka målsättningar som biodrivmedel kopplats till har skiftat under tidperioden och det har även funnits skillnader mellan olika styrmedel under samma tidsperiod. Forsknings- och utvecklingsstöd har varit fokuserade på att omvandla inhemska råvaror till biodrivmedel. Finansiella- och administrativa styrmedel har i stället främst varit utformade för att öka andelen biodrivmedel i den totala mängden drivmedel och inte för att öka den inhemska produktionen. Efter Sveriges inträde i EU har en stor del av den svenska biodrivmedelspolitiken varit utformad till att uppfylla de EU-direktiv som funnits. De styrmedel som existerat har haft en tydlig koppling till hur den svenska biodrivmedelsmarknaden utvecklats men sambandet är komplext och det har även funnits andra faktorer så som oljepriset som också haft en påverkan på utvecklingen. / In this thesis, the development of Swedish biofuel policy during the period 1975–2020 were investigated. The goal was to increase the understanding of the political motives behind the formulation of policy instruments and how the links between policy instruments and biofuel production have developed. A review of policy instruments targeting biofuels were conducted and presented in the report. The basis for the policy proposals has been summarized and some differences between the suggested policy and the final proposal have been discussed. The justifications and policy objectives referred to in the proposals have been put in a broader context to describe the development. The development of the biofuel market was investigated using the reports compiled annually by the Swedish Energy Agency, as well as previous compilations from several journals. What these reviews have shown is that biofuels have been used as a means of reducing the use of fossil-based petrol and diesel to achieve the targets in several different policy areas. At the beginning of the period, the main goal was to increase Swedish energy security, which was then supplemented by the goal of reducing harmful emissions. Reducing greenhouse gas emissions then became an increasing priority and has over the past 20–30 years been the main goal. The objectives to which biofuels have been linked have both changed during the period, and there have also been d¬ifferences between different policy instruments during the same period. Research and development support have been focused on converting domestic raw materials into biofuels, while financial and administrative instruments have mainly been designed to increase the share of biofuel use within the total use of transportation fuels and not to increase domestic production. Since Sweden's entry into the EU, a large part of the Swedish biofuels policy has been designed to comply with the EU directives that have existed. The policy instruments that have existed have had a clear connection to how the Swedish biofuels market has developed, but the relationship is complex and there have also been other factors that have affected the development, such as the oil price.