Research On The Linkage Between Petroleum, Sugarcane Ethanol And Sugar Market

Because of the scarcity of energy such as oil,fuel ethanol produced from sugarcane has become an emerging energy product.The basic raw materials of sugar are sugar cane and sugar beet,of which sucrose accounts for a higher proportion,and the connection between the sugar market and the energy market strengthens accordingly.Therefore,as a major importer of sugar in China and a major producer of sugarcane fuel ethanol,Changes in Brazil’s sugarcane production trends will have an impact on China’s sugar supply and demand.Based on this,analyzing the relationship between China’s sugar market,international sugar market and energy market will help to grasp the changing trend of sugar market in time and promote the stable development of China’s sugar industry.Based on the background of Brazilian sugarcane energy,this paper selects the monthly prices of the Chinese sugar futures and spot market,the Brazilian sugar spot and ethanol spot market,the international sugar futures and oil spot market from February2007 to December 2021 as sample data.Taking the Chinese sugar market as a research perspective,this paper studies the relationship between the domestic sugar market and the international sugar market,oil market and sugarcane fuel ethanol market.The research idea is to first make a detailed analysis of the changes in world sugar production,China’s sugar supply and demand changes,and changes in imports.Then the changes of sugar price,ethanol price and oil price are expounded respectively.The relationship between markets is discussed by cointegration test,DCC-GARCH model,causality test and other methods.Support vector mechanism is used to build a classification model to forecast the sugar price trend in China.The research conclusion are as follows:(1)The unit root test results show that the cointegration model and error correction model can be established for the four price series of Chinese sugar spot and futures,Brazilian sugar spot and international sugar futures.It is concluded that there is not only a long-term relationship but also a short-term equilibrium relationship between China’s sugar futures market and spot market,between the Chinese sugar market,the international sugar futures market and the Brazilian sugar spot market.(2)DCC-GARCH model is obtained by using yield rate series.The results indicate that there have intense dynamic correlation between the Chinese sugar market,the Brazilian sugar and ethanol market,the international sugar futures market,and the oil market.The increase in China’s sugar demand has intensified the sugar trade between China and Brazil,and deepened the correlation between China’s sugar market and Brazil’s sugar market and ethanol market.(3)The causal relationship between the markets is analyzed based on the yield series.The results show that the international oil and Brazilian sugar market mainly affects the Chinese sugar market by affecting the Brazilian ethanol market.At the same time,the Chinese sugar market will have a one-way transmission process to the Brazilian sugar market.This shows that China’s sugar market will be affected by Brazil’s sugarcane energyization,and China occupies an important position in Brazil’s sugar exports.In addition,both China’s sugar futures and spot markets will be affected by the one-way impact of the international sugar futures market,and the pricing power of China’s sugar industry in the international sugar industry market needs to be improved.(4)A benefical exploration of econometric problems is made using machine learning algorithms.The support vector machine is used to build the classification model and optimize the parameters through the grid search algorithm to predict the rise and fall trend of sugar spot prices and futures prices.The prediction accuracy of the spot price trend is0.7955,F1 value is 0.7949 and AUC is 0.87;the prediction accuracy of the futures price trend is 0.8182,F1 value is 0.8197 and the AUC is 0.88.According to research results,this paper presents some corressponding advices to effectively respond to the impact of the international market.Such as taking full advantage of the function of futures market,emphasizing the prediction and prevention and control of sugar import risks,and promoting the high-quality development of sugar.