Trade Shocks
Fertilizer Import Dependence and Domestic Food Prices After Global Supply Disruptions
Structural VARs quantify pass-through from international urea prices to retail maize markets in import-reliant economies.
Overview
Structural VARs quantify pass-through from international urea prices to retail maize markets in import-reliant economies.
Pass-through to retail fertilizer is rapid; pass-through to staple food prices is delayed and state-dependent on marketing board behavior.
Advanced Economic Research
Key insight · Applied Economic Perspectives (2023)
Key findings
- Exchange rate shocks and freight indices load on distinct impulse responses - composite import cost indices obscure policy levers.
Macro linkages
Post-2021 supply disruptions renewed debate on fertilizer subsidies versus soil-health investments.
We quantify how much of consumer food inflation was mediated through input channels versus energy and transport margins.
Methods
Bayesian VARs with informative priors on lag structure are estimated on monthly customs, wholesale, and retail series.
Identification uses sign restrictions consistent with pass-through theory.
Exchange rate shocks and freight indices load on distinct impulse responses - composite import cost indices obscure policy levers.
Advanced Economic Research
Trade Shocks · 2023
