The Empirical Analysis Of M2、WTI And Grain Price In China

In recent years, the grain price fluctuates severely in the international market, while the traditional supply and demand factors can not explain the phenomenon well, so people begin to look into the other factors that affect grain price. Through the exploration, people find that energy and financial factors such as net exports, M2 and CPI become the main factors that influence the international grain price, that is to say, the international grain price display the new features of "financialization" and "energy".In the backdrop of the international grain price presents new characteristics, in order to verify whether China’s grain price fluctuations also has the new characteristic, this paper adopts monthly data of corn, soybeans, wheat, rice prices, wti and M2 between January 1988 and July 2013, we use unit root test, cointegration test, granger causality test, threshold cointegration to explore the relationship between grain and finance and energy.Linear test results show that all variables are first single whole sequence, and all variables have long-term cointegration relationships. Nonlinear threshold cointegration test results show that between soybean, wheat, corn, rice and wti both have an effect of threshold, there are threshold effects between M2 and corn, wheat; while there are not threshold effects between M2 and soybean, rice. It suggests that the energy factors have a more significant impact on grain market in China, while the financial factors’impact on grain market is not significant. It makes we must strengthen the use of energy factors to better serve grain market’s stability.