Publication

This paper analyzes price formation on the world's rice market using simple supply and demand models as a start, but moving to 'supply of storage' models to explain hoarding behavior and its subsequent impact on prices. The author quantifies the impact of financial factors and actors on commodity-price formation using very short-run prices and Granger causality analysis for a wide range of financial and commodity markets, including rice. Finally, he addresses the long-run (since 1900) relationships among the prices of the three basic cereal staples, rice, wheat and corn (maize), which have declined more than 1 percent per year over the past century.