The Impact of the COVID-19 Pandemic on the Commodity Market: a Case Study of Wheat

Mohammad Tuhin

Master's thesis

Abstract:

This article comprehensively examines the worldwide influence of the COVID-19 epidemic on the wheat commodities market. The study examines the correlation between the producer price of wheat (dependent variable) and several parameters, such as wheat production value, export value, food inflation, and COVID-19. The analysis relies on a dataset that covers twenty-two years, specifically from 2000 to 2021. This study assessed the influence of COVID-19 by including a binary variable in the dataset covering the period from 2019 to 2021. Using the statistical software Gretl, This study calculated the coefficient using the Ordinary Least Squares method regression analysis. This study illustrates that the COVID-19 epidemic has significantly impacted the prices established by producers. COVID-19 has a significant negative impact on the producer price of wheat. As a result of the COVID-19 pandemic, the producer price has experienced a fall of 112.129 units. Moreover, wheat prices are positively influenced by the production value of wheat and food inflation, whereas the export value has a negative effect. All of the variable associations are statistically significant at the 0.05 significance level. The findings provide vital insights into the market dynamics within the COVID-19 epidemic and highlight the challenges faced by commodities markets during global crises. This analysis is limited by its dependence on historical data and its omission of certain variables that could potentially impact the price of producer wheat. Upon detecting the likely presence of autocorrelation, it is crucial to comprehensively evaluate this data and carefully assess the need to implement further adjustments to the model. In summary, the model demonstrates a substantial statistical influence, with the coefficients for Production Value and Food Inflation also displaying individual significance. The model suggests that the producer price of wheat is considerably affected by COVID-19 and factors such as production value, export value, and food inflation.

Keywords

Pandemic, Producer, Inflation, Export, Commodity

Language used: English

Date on which the thesis was submitted / produced: 16. 5. 2024

Thesis defence

• Date of defence: 6. 6. 2024
• Supervisor: Ing. Karel Malec, Ph.D.
• Reader: Jana Skřivánková, B.E., externi

Czech University of Life Sciences Prague

Faculty of Economics and Management

Master programme:
Economics and Management