Acreage response of maize in Thailand
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Abstract
Thailand has faced a shortage of maize for use in the domestic animal feed industry for almost two decades. While demand for maize has steadily increased, domestic maize yields have continuously declined, leading to increased imports of maize and wheat to substitute for domestically produced maize. One of the main causes of this decline is the reduction in maize planting areas, which may be attributed to farmers shifting from maize to alternative crops that provide higher returns. This study aimed to explore the factors influencing farmers’ decisions regarding maize acreage allocation and to better understand their acreage response behavior. Area response analysis was applied to examine how maize farmers respond to price incentives for maize and competing crops. The study used monthly time-series data from 1998 to 2017 and employed a multivariate copula-based VAR model for estimation. The copula concept can describe relationships between variables with different distributions without assuming a linear relationship. Therefore, it is suitable for real-world agricultural data, which are nonlinear and structurally complex. The results revealed that maize acreage decisions mainly depend on past maize prices and previous land-use patterns. In contrast, the prices of competing crops, such as cassava and sugarcane, do not have a direct effect on maize acreage. In addition, government policies related to other crops were not found to significantly influence farmers’ decisions. The findings also suggest that farmers’ land-use behavior tends to follow existing production patterns rather than respond to short-term price incentives.
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References
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