World Prices Research Articles

The Ethanol Market and Its Relation to the Price of Agricultural Commodities

In this article, we seek to present the synthesis of the global ethanol market in the United States (US) and Brazil by using caloric equivalence to empirically characterize the elasticity of supply and demand. We also seek to evaluate the relationship between world ethanol production and prices of agricultural commodities (wheat, rice, corn, soybeans and sugar) from 1981 to 2016 using climate-induced yield shocks as instrumental variables. The main results for the world market indicate that the production and demand for ethanol respond elastically to changes in commodity prices. The world ethanol production has no significant relationship with food prices. However, evaluation of the ethanol market and its interaction with the agricultural commodities market confirms the hypothesis that Brazilian ethanol is weakly related to the price of food.

Vaccines between war and market

This short paper presents a theoretical analysis that is intended to throw light on some issues related to the supply of vaccines in a context where producer countries are involved in armed conflicts. We present a simple model which combines elements of Hirshleifer-style economic analysis of conflict and microeconomic modelling of oligopolistic markets. In particular, we apply a simple Cournot duopoly model to two producer countries. Findings show that world supply of vaccines is indirectly and negatively affected by the existence of armed conflicts in a producer country that is involved in an armed conflict. Yet such negative impact on supply also increases the world price. In brief, participation of producer countries in armed conflicts turns out to be detrimental for global supply of vaccines.

STRATEGI PENGEMBANGAN AGRIBISNIS LADA HITAM LAMPUNG

Pepper is a type of spice that has a slightly bitter, spicy, and warm character. Based on market forecasts, the trend of pepper consumption will continue to increase during the period from 2019 to 2025. In the domestic market, pepper has the potential to continue to be developed due to the opportunity to increase its consumption. However, pepper agribusiness also experiences various problems including limited ability to adopt seed technology, cultivation, and processing, lack of farmer capital, pest, and disease attacks, fluctuations in world prices, and lack of farmers who master technology. Therefore, it is necessary to analyze the pepper agribusiness development strategy, especially in Lampung with its product which is well known in the global market, namely Lampung black pepper. The purpose of this study was to formulate a strategy for developing black pepper agribusiness in Lampung Province through the identification of internal and external strategic factors. The research was conducted in Lampung Province in 2018. The research was conducted using FGD and survey techniques. Determination of the sample is done purposively. The sample comes from pepper agribusiness actors, polipolicymakersd pepper experts.This study uses descriptive qualitative and quantitative methods with SWOT analysis. Based on the results of the analysis, it is known that the position of black pepper agribusiness in Lampung Province is in group V with the position of the hold and maintain strategy. Strategy formulation is carried out on strengthening the basis of strength (S) and opportunity (O). The resulting strategy formulation includes policies and regulations including market certainty and price policy, strengthening human resource capacity, institutional and partnership development, technological innovinnovation, strengthening agro-input systems.Keywords: Agribusiness, Black pepper, Strategy development, Technological innovation

Исследование мировой торговли хмелем и определение места России в товарообороте продукции

Abstract. The purpose of the work is the studies the world trade in hops and hop products in order to establish the structure of the main shipped products, to identify world market leaders by product type, prevailing world prices and their dynamics over the past five years. Methods. The calculations were carried out by the methods of statistical analysis according to Russian and international official Internet resources. Scientific novelty. The work made it possible to form a list of types of hops and hop products, which are the most important goods imported into Russia and constitute the main burden of foreign hop supplies in domestic imports; to determine the price difference between the importation of products from abroad to Russia and the average prices for their sale in international markets by country, which became the beginning of forecasting potential new suppliers of products. Results. The global hop growing market is mostly represented by crushed and pelleted hop cones (according to 2021 data, they accounted for 60.6 % of the total structure of world exports). It is this product that is predominant in the import of hops in Russia (73.8 % of imports according to data for 2021). The main exporters of these products to Russia were such countries as Germany (64.2 % of Russian imports), Belarus (13.5 %) and the USA (10.5 %). Imported products from the USA were the most expensive for Russia - $24,927/t, shipments from Belarus were the cheapest - $3,563/t. At the same time, shipping prices from the US to Russia are 26 % higher than the average prices for all US exports ($19,821/t). Germany exported products to Russia at a price of USD 10,749/t, which is 7.3 % lower than the average prices of all shipments in the country. Prices for hops from China (6,890 USD/t) and Poland (7,817 USD/t) for Russia are also noticeably lower compared to the cost of shipments of products by counterparties in other countries.

Исследование мировой торговли хмелем и определение места России в товарообороте продукции

Abstract. The purpose of the work is the studies the world trade in hops and hop products in order to establish the structure of the main shipped products, to identify world market leaders by product type, prevailing world prices and their dynamics over the past five years. Methods. The calculations were carried out by the methods of statistical analysis according to Russian and international official Internet resources. Scientific novelty. The work made it possible to form a list of types of hops and hop products, which are the most important goods imported into Russia and constitute the main burden of foreign hop supplies in domestic imports; to determine the price difference between the importation of products from abroad to Russia and the average prices for their sale in international markets by country, which became the beginning of forecasting potential new suppliers of products. Results. The global hop growing market is mostly represented by crushed and pelleted hop cones (according to 2021 data, they accounted for 60.6 % of the total structure of world exports). It is this product that is predominant in the import of hops in Russia (73.8 % of imports according to data for 2021). The main exporters of these products to Russia were such countries as Germany (64.2 % of Russian imports), Belarus (13.5 %) and the USA (10.5 %). Imported products from the USA were the most expensive for Russia - $24,927/t, shipments from Belarus were the cheapest - $3,563/t. At the same time, shipping prices from the US to Russia are 26 % higher than the average prices for all US exports ($19,821/t). Germany exported products to Russia at a price of USD 10,749/t, which is 7.3 % lower than the average prices of all shipments in the country. Prices for hops from China (6,890 USD/t) and Poland (7,817 USD/t) for Russia are also noticeably lower compared to the cost of shipments of products by counterparties in other countries.

World prices and business cycles in a small open input–output economy

The role of terms-of-trade shocks in driving economic fluctuations is revisited through a multisector small open economy model, where the various types of goods can all be consumed and employed as inputs. Under this assumption, we show that, unlike conventional wisdom, terms-of-trade shocks may not necessarily trigger an economic boom for the exporting country if its export goods are intensively employed or consumed domestically, with limited scope for substitution. We calibrate and estimate the proposed model using data from 15 emerging countries and find that it performs better than the standard model to explain the different impacts of terms-of-trade shocks across countries documented by Schmitt-Groh and Uribe (2018). Such results make the model an excellent new framework to extend the analysis of monetary policies and the effects of price changes. • This study uses a multisector SOE model with a realistic input–output structure. • Common models overestimate terms-of-trade shocks’ impacts in emerging countries. • Using export goods dampens the expansionary effects of terms-of-trade shocks. • High elasticity of substitution between goods neutralizes the dampening effects. • The model extends the analysis of the price change effects.

Risk, Monetary Policy and Asset Prices in a Global World

Risk, Monetary Policy and Asset Prices in a Global World

АНАЛИЗ ЦЕН НА РОССИЙСКУЮ ХИМИЧЕСКУЮ ПРОДУКЦИЮ В 2022 ГОДУ

The article provides an analysis of the world and domestic prices of chemical products of the Russian Federation by the results of 2022. During the study period, there was a significant fluctuation in prices on the domestic and world markets for almost all products of the chemical complex. The greatest growth occurred in April – May 2022, after which prices began to gradually decrease and stabilized by September – October. It is shown that the most expensive products of the chemical complex are insecticides and herbicides, and some household chemicals and synthetic detergents are the cheapest.

Development of the cultivated mushroom market from the standpoint of time series sustainability

The article deals with the issues of sustainable development of the world market of cultivated mushrooms. The authors of the article have studied the time series of the world gross value, world volumes of imports and exports, the world price index for cultivated mushrooms and truffles in order to analyze their growth and dynamics. The results of calculations carried out using the statistical database of the Food and Agriculture Organization of the United Nations from 1961 to 2022 showed that the indicated time series are non-stationary. The gross value of mushroom production increased 70 times during the study period, the volume of imports increased 98 times, the volume of exports increased 93 times, and the producer price index doubled. The price index for cultivated mushrooms and truffles is stable without sharp fluctuations. The authors reveled shifts in a series of world gross value of mushroom production in 2000, 2009, 2011. Additive emissions, level shifts and temporary changes were found in the dynamics of world imports and exports.

Эконометрическое прогнозирование на 2023 год ВВП России в условиях санкционных ценовых ограничений на экспорт нефти марки «Юралс»

The 2023 has seen a significant increase in the sanctions pressure on Russia and Russian national economy from geo-economic and geo-political opponents. Such a pressure affected, in particular, the oil production and oil refining industries. From December 5, 2022, most Western countries introduced a price ceiling for the purchase of Russian crude oil ($60 per barrel), and from February 5, 2023, on Russian petroleum products traded at a premium and at a discount to crude oil ($100 per barrel and $45 per barrel, respectively). Under these conditions, it is important to foresee what impact the above price and other sanctions will have on the dynamics of Russia’s GDP and its growth. As a forecasting tool, we use the macroeconomic production function, where GDP depends on fixed assets, the level of their use, the labor and the world price of Urals oil, the values of which were selected in accordance with forecasts of the Bank of Russia and the Russian Ministry of Economic Development at the level of $55 and $65 per barrel (in 2010 dollars). The originality and advantage of this production function over many other forecast models are the following: firstly, its average ex-post forecast errors for 22 years ahead do not exceed 5,1%, and, secondly, over these years the direction of the dynamics of ex-post forecast GDP coincides almost everywhere with the direction of the dynamics of actual GDP, including during the crisis of 2009, sanctions pressure started in 2014 and the epidemic of the Wuhan coronavirus SARS-CoV-2 in 2020-2021. The results of econometric forecasting showed the following: at a price of $55, the minimum growth rate of Russia's GDP will be – 1,1%, the average will be 0,2%, and the maximum will reach 1,6%. At a price of $65, the minimum growth rate of Russia's GDP will be 1,7%, the average will be 3,1%, and the maximum will be 4,5%. Thus, according to our forecasts, the Russian economy will grow, instead of falling into recession as many geo-economic and geo-political opponents of Russia would anticipate.

Методика отбора регионов для исследования адаптации сельского хозяйства к изменению климата

The impact of climate change on the social and institutional conditions of agriculture (as opposed to technological ones) in Russia has hardly been studied. With a limited budget, such research should examine a small sample of regions. To reduce the subjectivity, a formalised methodology for creating and ranking small samples of regions was developed. While occupying the largest possible share in the country’s gross agricultural production, the regions included in the sample should significantly differ in natural and agricultural zones, agricultural production efficiency, contribution of peasant farms to agricultural output. Unlike other methods, the proposed technique uses a linear programming problem, where all corner solutions are integer. Data envelopment analysis (DEA) was utilised to ensure the inclusion of both efficient and inefficient regions in the sample. In accordance with these requirements, Altai, Krasnoyarsk, Krasnodar krais and Moscow oblast were selected for analysis. For the regions included in at least one of the five best samples (such as Volgograd, Saratov and Leningrad oblasts), a model of partial equilibrium on the wholesale markets of agricultural products of the constituent entities of the Russian Federation (VIAPI model) was applied to assess the impact of scenario climate change on the output and wholesale prices of ten types of agricultural products. The research revealed that while the production in the selected regions is resistant to this influence, except for Altai and Krasnoyarsk krais, regional market prices are still rising due to the impact of world prices for milk products and grain.

ГЛОБАЛЬНІ ЕНЕРГЕТИЧНІ ТРАНСФОРМАЦІЇ: ЕКОНОМІЧНИЙ ІНСТРУМЕНТАРІЙ

Despite the existence of a fairly diversified arsenal of economic stimulation of global energy transformations, the choice by states of their specific elements directly depends on the ratio of socio-economic and environmental effects from the introduction of motivational incentives, on the one hand, and the total costs of their implementation and administration, on the other. In addition, the strategic goals of sustainable development of each state and the availability of various financial sources for the implementation of specific mechanisms and tools for its stimulation are also taken into account. The wide implementation of the mentioned toolkit in recent decades ensured the high dynamics of the development of the green segment of the national energy markets of the leading countries. At the same time, the wide use of effective motivational incentives for energy transformations by national governments ensured a significant reduction in the level of world prices for green energy technologies, their active inclusion in international scientific and technological transfer, and the increasing involvement of states and entire regions in the innovative achievements of humanity in the field of "greening" of economic activity. Already in the coming years, energy eco-technologies will lead to a significant reduction in the cost of electricity generation, which opens up wide prospects for the world community regarding the transition of the energy complex to a model of sustainable development. Despite all the achieved advantages of economic stimulation of global energy transformations, in the coming decades, the world community must implement decisive measures to introduce a system of anti-carbon taxation at the global level. Achieving the strategic goal of increasing the effectiveness of environmental tax instruments also lies in the area of introducing a system of stimulating tax benefits and preferences for environmentally responsible product manufacturers with the aim of forming large-scale capital accumulation funds. Thus, all the mentioned directions are able to bring the motivational system of energy transformations to a qualitatively higher level of development and the world community to achieve significant socio-economic effects from the greening of energy.

Экономическая конъюнктура в Дальневосточном федеральном округе в 2022 г.

The socio-economic situation in the Far Eastern Federal District in 2022 is analyzed by main types of economic activity and territorial administrative regions on the basis of operative statistical, analytical and expert information. The paper considers the problems of functioning of the real sector of the economy, social sphere, foreign economic activity in conditions of aggravation of the geopolitical situation and imposition of sanctions. The positive dynamics of investment activity was noted, but its growth rate was lower than the level of 2021. The main volume of investment resources is still accumulated in the Republic of Sakha (Yakutia) and the Amur Oblast, where the implementation of major investment projects in the field of mining, transport, gas chemistry and energy continue. The decline in industrial output in the Far Eastern Federal District was caused by a drop in mining, especially in the Sakhalin Oblast, and a decline in the manufacturing sector. The construction sector of the Far Eastern Federal District demonstrated positive dynamics, connected, among other things, with the expansion of housing construction. But high rates of housing construction in the regions of the Far Eastern Federal District cannot yet compensate for the chronic lag in housing commissioning per capita compared with the average Russian parameters. The transport complex of the Far Eastern Federal District has faced an increase in demand for transportation of foreign trade goods. This aggravated competition for access to the export-import infrastructure (railroads, seaports) with limited carrying capacity, increased shippers’ costs and uncertainty of transportation conditions. The negative impact of various restrictive measures did not affect the structure of Far Eastern Federal District foreign trade. A decrease in the physical volume of exports of fuel and energy products was leveled out by high world prices for energy resources. A decrease in economic activity was substantially influenced by a contraction of the domestic demand against the background of a decline in the population’s real income. The decline in the population, both due to natural decrease and migration outflow, remains an acute problem

The impact of the war in Ukraine on economic development, consequences for world trade

The war in Ukraine created a humanitarian crisis of enormous proportions and also a serious blow to the world economy. From a macroeconomic point of view, rising food and energy prices will reduce real incomes. CNUCED's express assessment of the impact of the war on trade and development in Ukraine confirms that the outlook for the global economy is rapidly deteriorating due to rising food, fuel and fertilizer prices. This study examines the impact of the crisis in Ukraine on global trade and development, highlights the importance of supplies of food, energy and certain industrial resources from Russia and Ukraine, and examines how the war poses significant risks to food and energy security and exacerbates the difficulties associated with with the supply chain. This study also shows that if a war were to split the world economy into separate blocs, the loss of income would be significant, especially for developing countries. Furthermore, it underscores the importance of a rules-based multilateral trading system, if only because the World Trade Organization provides functions that can help mitigate the effects of the crisis. It is important for international trade to better understand, analyze and monitor the nature, magnitude and implications of war for trade and development. Only with a clear understanding of these impacts can we create reliable supply chains, limit further losses in trade and economic development, and prevent the deepening of inequality between developed and developing countries. The purpose of the study is to analyze the impact of the war in Ukraine on economic development and determine the consequences for world trade. The research used the methods of induction and deduction and comparative analysis. The study shows that among the main threats and risks that arise for the world economy are destabilization, rising inflation, unemployment, the emergence of a food crisis and famine in some countries of the world, and an increase in world prices for raw materials. The consequences of the war in Ukraine will be felt by most countries of the world, and their scale will depend on the course and duration of the war on the territory of Ukraine. The biggest loss and the biggest problem of the war is human loss, but there are also huge economic problems that are felt far beyond the borders of Ukraine.

ОСНОВНІ ВИКЛИКИ ФУНКЦІОНУВАННЯ ІНДУСТРІЇ КРИПТОВАЛЮТ НА ФІНАНСОВОМУ РИНКУ

The article analyzes the rating of Ukraine according to the Global Cryptocurrency Adoption Index. It is noted that out of the TOP-20 countries in the rating, there are ten countries with below-average income, eight countries with above-average income and two countries with high income. This trend demonstrates the dominance of developing markets. The dynamics of the bitcoin and USD exchange rate are analyzed. Forecasting of the bitcoin exchange rate was carried out using the exponential smoothing method, because this method showed the smallest mean absolute error. The forecast results show the growth of the bitcoin rate. The interdependence between exchange rate of bitcoin cryptocurrency and pairs of the most influential world currencies, world prices for precious metals and securities rates on the largest stock exchanges is determined using correlation-regression analysis. The advantages of using cryptocurrencies have been identified, including high speed of transactions, reduction of the number of intermediaries and low fees. Also defined the threatening nature of the development of the crypto-industry for the economic potential of the state, taking into accountavailable withcurrent global challenges such as cyber-attacks and fraud and data theft. Real fraud schemes in the field of cryptocirculation are considered. The main challenges to the functioning of the cryptocurrency industry are analyzed, including volatility, uncertainty, risk of loss, insecurity of owners, lack of guarantees, large number of cryptocurrencies, technical risk, fraud and data theft. It is noted that without determining the clear legal status of cryptocurrencies in the country, it is impossible to resolve the legal, accounting and tax consequences of these transactions. It was determined that for the legal circulation of cryptocurrencies, the creation of a financial institution or a special state body, which should exercise control over the circulation of cryptocurrencies, must be ensured as a minimum; introduction of taxation for companies whose activities are related to the crypto industry; establishing the obligation of users to declare their income and profits from income regarding crypto-assets in the national currency, etc.

Macroeconomic production function of Russia and estimation of the marginal rate of technical substitution in the unprecedented socio-economic realities of 2020–2022

In the period 2020-2022, the Russian economy has been facing the new, unprecedented challenges of coronavirus and sanctions. In order to analyze the current state of affairs, we are offering an econometric study of Russia’s macroeconomic production function for 1990-2022 and an estimation of the marginal rate of technical substitution under internal and external restrictions associated with the spread of the Wuhan coronavirus (SARS-CoV-2) and the conduct of Russia’s special military operation in Ukraine, accompanied by increased sanctions pressure on the Russian economy. We have obtained several significant results. In the years 1991-1996 the marginal rate of technical substitution was increasing, and in 1997-2020 it was decreasing except for 2008-2009 and 2015. In the context of the Wuhan coronavirus pandemic, the main reasons for the Russian economy’s decline in 2020 and growth in 2021 were, first of all, fluctuations in the world crude oil price, and not the Wuhan coronavirus pandemic as such. We did not find any evidence that the decline in the world crude oil price in 2020 was caused by a decrease in demand from China, since Russian oil exports to China increased. Contrary to many negative forecasts, the results of our forecasting of Russia’s GDP for 2022 show that under sharply increased sanctions pressure, with the world price of Urals oil at $60 per barrel, the average growth rate will be 0%, while at $70 it will be 4%, and at $80 it will be 7%. Under the reduced demand for Russian gas and the shutdown of the Nord Stream 1 gas pipeline, the forecast volumes of gross natural gas production by Gazprom (excluding Gazprom Neft) in the Tyumen Region for 2022, based on the exponential production function studied by econometric methods, range from 364 to 392 billion cubic meters. Using the example of Great Britain, where in 2021 the average actual export prices for Russian oil and gas were the lowest compared to other Western European countries, we discuss the economic inexpediency of setting marginal prices for Russian energy products by Western consumers.

Zanzibar'da Karanfil İhracatının Belirleyicileri: Politika Önerileri

Clove is one of the high value spices that have supported the economy of Zanzibar for many decades since the 18 th Century. However, clove production and exports have been declining significantly and consistently since the 1980s. The declining of the clove exports most likely jeopardizes the Zanzibar efforts to improving human development with positive changes in living standards. This paper analyses factors for the declining trend in clove exports using time series data that were collected between 1980 and 2020 and analysed using the vector error correction model, complemented with qualitative data collected from 39 key informants. The time series results show that clove production, producer price, world price, Gross Domestic Product (GDP), and Exchange Rate had positive and statistically significant impact on clove exports in a long-run at 1% level of significance; while Foreign Direct Investment, human population and Cross Capital Formation showed significant negative impact. Only inflation showed insignificant negative impact. Based on qualitative results, there were two major determinants: (i) factors that affected clove production, and (ii) low and fluctuation of the clove price. The time series results coincided with qualitative information. We conclude that some factors affected clove exports indirectly through clove production. Other factors affected exports through fluctuation of clove price. Therefore, we recommend an integrated policy approach that aims at improving clove production and price stabilization in order to rectify the decreasing trend in clove exports.

SYSTEM ANALYSIS OF SUBJECTS CRYPTOCURRENCIES OPERATIONS IN THE CONDITIONS OF GLOBAL CHALLENGES

The article considers cryptocurrency as a new type of intangible assets and the regulatory and legal support for its implementation. Particular attention is paid to defining the content, legal status, features of accounting, and taxation of transactions with such assets. The market capitalization and bitcoin forecast are analyzed. The interdependence between the exchange rate of bitcoin and pairs of the most influential world currencies, world prices for precious metals, and securities rates on the largest stock exchanges is determined. The most significant influencing factors on the bitcoin price are determined using correlation and regression analysis. The advantages of using cryptocurrencies have been identified, including high speed of transactions, reduction of the intermediaries number, and low fees. The threatening nature of the crypto-industry development for the economic potential of the state is also determined, taking into account available with current global challenges such as cyberattacks and fraud and data theft. Real fraud schemes in the field of crypto-circulation are considered. It is noted that without determining the clear legal status of cryptocurrencies in the country, it is impossible to resolve the legal, accounting and tax consequences of these transactions. It was determined that for the legal circulation of cryptocurrencies, the creation of a financial institution or a special state body, which should exercise control over the cryptocurrencies circulation, must be ensured as a minimum; introduction of taxation for companies whose activities are related to the crypto industry; establishing the obligation of users to declare their income and profits from crypto-assets, etc. Because of this, the functions of state authorities in regulating operations with cryptocurrencies are characterized, and the changes that will be introduced to the Tax Code of Ukraine are analyzed, regarding the taxation of transactions with cryptocurrencies, which in the future will make it possible to increase budget revenues, regulate and facilitate accounting and taxation of transactions with cryptocurrencies, use legal remedies for virtual assets, reduce possible tax evasion, etc.

The Green Revolution and the Gene Revolution in Pakistan: Policy Implications (The Quaid-i-Azam Memorial Lecture)

Pakistan achieved high levels of Green Revolution Modern Variety (GRMV) adoption in the Green Revolution. Pakistan out-performed India and Bangladesh in the Green Revolution. Only China, among major countries, out-performed Pakistan in the Green Revolution. Pakistan does not have the food safety and environmental risk studies in place to support a regulatory environment for biotechnology. In effect, Pakistan is following the “precautionary principle” and applying it to science policy. This paper argues that this is a mistake. Pakistan is paying a “double penalty” for its inability to develop the regulatory systems required to take advantage of genetically modified (GM) crops. Not only does it lose the cost reductions enabled by GM crops, but because other countries have adopted GM crops, world prices are lower as a result and affect Pakistan’s export crops.

Regional Trade and Food Price Stabilisation in South Asia: Policy Responses to the 2007-08 World Price Shocks

World price shocks and disruptions in international cereal trade in 2007 and 2008 caused considerable anxiety and hardship for food importing countries throughout the world. In many countries, high international food prices raised import costs, reduced total supplies for consumers and ultimately led to lower real incomes and food consumption for poor households. In South Asia, Pakistan, Afghanistan, Bangladesh and India were all affected by these movements in international prices, though the effects on domestic prices in each case was mitigated or exacerbated by each country’s own trade policies, as well as the trade policies of its neighbours. Prior to 2007, the general consensus among most economists and food policy analysts was that openness to international trade, particularly private sector trade, was the most efficient mechanism for stabilising domestic food prices and supplies. In light of the 2007-08 experience, however, many observers have concluded that international markets cannot be trusted and that countries should rely on their own domestic production to ensure national and household food security. This paper argues that liberalised international trade still provides the best mechanism for stabilising prices and food supplies in most years, but that appropriate contingency policies are needed for years in which international prices are extraordinarily high.1 More explicit commitments to cereal trade liberalisation within South Asia would also promote region-wide food security and help avoid a repetition of supply disruptions that raised food prices sharply in Afghanistan and Bangladesh. Section II of this paper briefly