| Food security is a major event about the people’s livelihood and national security. As one of the three major food crops,wheat is the foundation of national economy. Study on the price formation mechanism and price volatility characteristics plays an important role for the food supply security and economic stable development.This paper can be divided into three parts. Firstly, wheat price formation mechanism is analyzed. The connotation of wheat price formation mechanism and three stages of the evolution of the wheat price formation mechanism has been analyzed in length. These three phases are program-driven wheat prices formation mechanism, program-based wheat prices formation mechanism which is supplemented by market and market-oriented wheat prices formation mechanism which is supplemented by state regulation. Therefore, we come to the conclusion that the reaction time of wheat prices on supply and demand is inconsistent.Secondly, the main factors affecting the fluctuations of wheat price of are analyzed. According to the formation mechanism, the main factors are wheat production, wheat consumption, international trade and national support policies. How these factors affect the fluctuations of wheat price are analyzed in detail. Then we obtain conclusions that the most significant factor influencing fluctuations in wheat prices is the cost of production and so on.Thirdly, the volatility characteristic of wheat price is analyzed quantitatively. By the method of statistical analysis, the volatility characteristics of wheat price from the reform and opening-up to the 21 st century are analyzed. Then the volatility characteristics of wheat price from the 21 st century to present are analyzed by the method of model analysis. We use the monthly wheat price data from 2000 to 2015 for model analysis. Eliminate the effects of inflation and seasonal factors on the price of wheat by calculations and using Census X12 method, then, respectively use HP filter and ARCH and related extension model to analyze the dates which have already processed.We obtain the conclusions that the price of wheat is determined by the wheat market supply and demand, and affected by the policy of state; fluctuations in the price of wheat belongs to an expansionary cycle fluctuations; fluctuations in the price of wheat has a non-symmetry.Based on the above study, five recommendations are put forward,thus, improve the price formation mechanism to enhance the enthusiasm of farmers; strengthen the construction of market information, establish an early warning system for the wheat market; innovative agricultural production techniques to improve wheat yields; guide farmers to produce reasonably to reduce production costs; perfect crisis response mechanism, enhance the fighting capacity. |
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