The effects of population, income, prices of major inputs, and exchange rateof the U.S. dollar on the prices of three key agricultural and foodcommodities (feed grains, oilseed, and fruits) for 13 low-income countriesand seven middle-income countries were evaluated. Given the short timeperiod, a modified seeming unrelated regression-vector autoregressive modelthat incorporates the lagged exogenous variables property of time seriesmodels and the system of equation estimation is employed in the analysis.The study finds no single factor that persistently explains all soaring foodprices as reported in the literature. The only factor that persistentlyexplains soaring food prices are the contemporaneous and one-year laggedexchange rates and income.
