The Empirical Analysis of the Effect of Temporary Purchase and Storage Policy Reforms on Agricultural Products' Marketization

With the cancellation of Temporary Purchase and Storage Policy (TPSP) on soybean, cotton and corn one by one, which has been enforced for many years, the price of these agricultural products has realized full marketization. In this paper, we study the price transmission of corn and corn starch before and after temporary purchase and storage policy reform on corn, and analyze the risk of volatile price with corn futures contracts and the change of agricultural futures market at home and abroad. First, by using Granger test, we find that the price of corn is the Granger reason of corn starch after the cancellation of TPSP on corn. Secondly, with GARCH model on the price of corn futures, we have that TPSP on corn results in slightly higher volatility of the corn futures market with a low level of statistical significance. Finally, by using network model,we study the topological structure of 20 agricultural products at home and abroad futures price network before and after TPSP, which shows clustering? coefficient, average degree and network density all have increased.