[KSCI] Korea Science Citation Index Service

http://dx.doi.org/10.5394/KINPR.2021.45.2.069

Lead-lag Relationship between the Shipping Freight Rate and Agricultural Commodity Import Price in Korea

Ha, Jae-Young (CJ Foodville)
Shin, Youngran (Graduate School of Global Logistics, Korea Maritime and Ocean University)

Publication Information

Journal of Navigation and Port Research / v.45, no.2, 2021 , pp. 69-74 More about this Journal

Abstract

This study aims to investigate the lead-lag relationship between the agricultural produce import price in Korea and the corresponding shipping freight rate. Since the Korean economy has pursued an export-driven growth strategy, mainly based on the manufacturing sector, the country has to depend on the vast majority of its agricultural produce consumption after import from foreign countries. Moreover, compared with other high-value products, transportation cost occupies a substantial share of the agricultural commodity price, resulting in changes in the shipping freight rate being a pivotal determinant of agricultural produce import. In this respect, this study explores the possible association between agricultural produce import in Korea and shipping freight rate and the lead-lag relationship. Using a monthly dataset of agricultural produce import prices and freight rates for Handysize and Panamax dry-bulkers for the period between January 2010 and November 2020, this study determines that the shipping freight rate, in general, leads the agricultural commodity price.

Keywords

commodity price; freight rate; granger causality; lead-lag relationship; vector autoregression;

Citations & Related Records

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