An Econometric Estimation of The World Price Leadership Impact on The Production and Export of Peanut of A.R.E التقدیر القیاسى لأثر القیادة السعریة العالمیة على إنتاج وتصدیر الفول السودانى بجمهوریة مصر العربیة

Abstract

The study aims to evaluate the market integration in the main importing markets for the Egyptian shelled groundnut among other rivals. The study applied Vector Error-correction model (VECM) to test the co-integration existence between prices. Geographical Concentration investigation showed that Greece, Italy, Turkey, Tunisia, Jordon, Syria, and Netherlands are the main importers of Egyptian groundnut exports. The Augmented Dickey-Fuller test (1987-2017) revealed that all prices are stationary at the 1 st differences, i.e. prices are integrated of order one P~I(1).Johansen co-integration test indicated that there is only one cointegration equation that confirm the long run relationship among rivals 'prices of shelled groundnut in each market.Error Correction Terms (ECTs) proved the unidirectional impact of other exporters 'prices on the Egyptian export price, and 6%, 22.8%, 70.6%, 75.3%, and 58.1% of the Egyptian price disequilibrium were be adjusted each year in Greece, Italy, Turkey, Jordon, and Netherlands markets respectively. Weak exogeneity test revealed that Argentine is considered a price leader in Greece, Italy, and Netherlands, and China is considered a leader price in Turkey and Jordon, while Tunisia is considered a regular price competitive. It is expected that the Egyptian export price will upward deviate 23%, 1%, and 31% from Argentinian price in Greece, Italy, and Netherlands markets respectively, and 13.7%, 27.6% from Chinese price in Jordon and Turkey respectively. It is recommended that Egyptian exporters should adopt low price policy not less than the leaders' prices as it covers the producer cost to allure importers to redirect to the Egyptian market.