The impact of Russian sanctions on the return of agricultural commodity futures in the EU

Jeroen Klomp*

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

During the last conflict between Russia and the Ukraine in 2014, the EU imposed various multilateral sanctions on Russia. As a response, Russia retaliated these measures by banning the agricultural imports from the EU. This study explores whether the retaliation sanctions taken by Russia were already expected by investors or came as a complete surprise. For this purpose, I compare the impact of sanction-related news before and after the official announcement of these sanctions by president Putin in August 2014 on the weekly return of a number of agricultural commodity futures traded at two European commodity exchanges. A newly created indicator on sanction-related news is used that is based on the number of articles that have been published in the major European newspapers containing information about the import ban. The main findings clearly point out that before the imposition of the boycott it was already partly anticipated. The publication of sanction-related news caused a significant drop in the futures return of a number of banned agricultural commodities in the weeks prior to the formal announcement.

Original languageEnglish
Article number101073
JournalResearch in International Business and Finance
Volume51
DOIs
Publication statusPublished - 1 Jan 2020

Fingerprint

Commodity futures
Agricultural commodities
Sanctions
Russia
News
Announcement
Import
Ukraine
Surprise
Boycott
Retaliation
Commodities
Investors

Keywords

  • Agricultural commodities
  • Futures return
  • Pro-Russian conflict
  • Sanctions

Cite this

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The impact of Russian sanctions on the return of agricultural commodity futures in the EU. / Klomp, Jeroen.

In: Research in International Business and Finance, Vol. 51, 101073, 01.01.2020.

Research output: Contribution to journalArticleAcademicpeer-review

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