Price Behavior, Bubbles, and Forecasting

A long-running strand of my work asks when commodity prices become disconnected from fundamentals. Starting with my dissertation under Scott Irwin and Philip Garcia, I have used explosiveness tests and structural models to examine whether speculative bubbles occur in grain and food futures markets, how long they last, and what role index traders and speculators actually play. The evidence consistently points to bubbles being short-lived and less driven by financial speculation than public debate assumed.

A second strand builds forecasting tools with direct policy value. With coauthors at USDA and the World Bank, I have developed adaptive food price forecasts to support public information during rapid inflation, alternative methods for forecasting season-average farm prices, and analyses of long-run yield and food price trends.

Representative publications

• Lai, T.*, Etienne, X.L., Hu, Z.#, and Peng, K. 2026. Price bubbles and contributing factors: Evidence from the Chinese urea fertilizer market. Applied Economics Letters, 33(9), 1449–1453. doi
• MacLachlan, M.J., Adjemian, M.K., Etienne, X.L., Sweitzer, M., Volpe III, R., and Zeng, W. 2025. Adaptive food price forecasts enhance public information during rapid economic changes. Nature Communications, 16, 6282. doi
• Hu, Z., Yan, L., Yuan, J.*, and Etienne, X.L.# 2025. Deconstructing fertilizer price spikes: Evidence from the Chinese urea fertilizer market. Food Policy, 133, 102829. doi
• Baffes, J., and Etienne, X.L.# 2024. Yield growth patterns of food commodities: Insights and challenges? PLoS ONE, 19(11), e0313088. Also issued as World Bank Policy Research Working Paper 10990. doi
• Etienne, X.L., Farhangdoost, S.*, Hoffman, L.A., and Adam, B. 2023. An alternative method to forecast the season-average farm price of corn in the U.S. Journal of Commodity Markets, 30, 100333. doi
• Etienne, X.L., Irwin, S.H., and Garcia, P. 2018. Speculation and corn prices. Applied Economics, 50(44), 4724–4744. doi
• Li, J.*, Chavas, J.-P., Etienne, X.L., and Li, L. 2017. Commodity price bubbles and macroeconomics: Evidence from Chinese agricultural markets. Agricultural Economics, 48(6), 755–768. doi
• Etienne, X.L. 2017. Irrational exuberance in the Chinese iron ore market? Applied Economics Letters, 24(16), 1161–1166. doi
• Etienne, X.L., Irwin, S.H., and Garcia, P. 2017. New evidence that index traders did not drive bubbles in grain futures markets. Journal of Agricultural and Resource Economics, 42(1), 45–67. doi
• Baffes, J., and Etienne, X.L. 2016. Analyzing food price trends in the context of Engel’s Law and the Prebisch–Singer hypothesis. Oxford Economic Papers, 68(3), 688–713. doi
• Hoffman, L., Etienne, X.L., Irwin, S.H., Colino, E.V., and Toasa, J. 2015. Forecast performance of WASDE price projections for corn. Agricultural Economics, 46(s1), 157–171. doi
• Etienne, X.L., Irwin, S.H., and Garcia, P. 2015. $25 Minneapolis wheat was a bubble, right? Agricultural Finance Review, 75(1), 114–132. doi
• Etienne, X.L., Irwin, S.H., and Garcia, P. 2015. Price explosiveness, speculation, and grain futures prices. American Journal of Agricultural Economics, 97(1), 65–87. doi
• Etienne, X.L., Irwin, S.H., and Garcia, P. 2014. Bubbles in food commodity markets: Four decades of evidence. Journal of International Money and Finance, 42, 129–155. doi
• Colino, E.V., Irwin, S.H., Garcia, P., and Etienne, X.L. 2012. Composite and outlook forecast accuracy. Journal of Agricultural and Resource Economics, 37(2), 228–246. doi

In progress

• Baffes, J., and Etienne, X.L. Food commodity price movements: Disentangling the role of supply–demand fundamentals.
• Franken, J., Etienne, X.L., and Irwin, S.H. Farmland price bubbles.
• Jo, J., Etienne, X.L., and Adjemian, M. Inflationary effects of biofuel policy shocks.