Determinants of agricultural commodity prices: Evidence from kernel-based regularized least squares (KRLS)

The long-term trend behavior of agricultural prices and periodic price increases, agricultural development and agribusiness have a decisive influence on economic growth for many countries. For this reason, it is important for countries to examine the factors that affect agricultural commodity prices. Agricultural commodity markets are influential in many areas from ensuring food security to the economic contribution of the agricultural sector, from price stability to international trade. The study of these markets plays a critical role in understanding the functioning of economic and social systems. The thesis aims to examine the relationship between agricultural commodity prices and the temperature anomaly used to measure oil prices, exchange rates and climatic effects. For this purpose, Kernel-Based Organized Least Squares Method was used for econometric analysis. According to the findings, oil prices and real effective exchange rate have an impact on agricultural commodity prices.