Impacts of energy prices and trade-demand elasticities on Saskatchewan agriculture

With the help of a quadratic programming sector model of Saskatchewan agriculture, it is demonstrated that magnitudes or rising energy-price impacts can be significantly different if producers face different levels of trade-demand elasticities. Although consumers would always lose as a result of rising energy prices under varying demand elasticities, this is not always the case with producers. Net returns to producers may increase even under a rising energy-price regime if they face very inelastic markets. Similarly, other energy price impacts are shown to differ significantly under varying demand elasticities.