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Abstract
Barriers to the entrance, the concentration observed and the increase of
prices of fertilizers had conducted to the diffidence of the possibility of the exercise of
market power on part of companies which represent the Brazilian industry of the NPK
(04- 14- 08) fertilizer. These indications can be a necessary condition, however not
enough to affirm the existence and the exercise, in fact, of the power. The objective was to identify the behavior of the representative companies of the NPK (04-14-08) fertilizer
industry, through the estimate of the average parameter of behavior, λ. The period of
analysis was February 1993 until December 2006. The analysis of the behavior of the
firms was based on the New Empirical Industrial Organization (Neio) theory. λ was
projected through the interaction of the demand equation and the representative supply
ratio of the industry. Under λ, the hypothesis test was applied to know the behavior of the
firms. Results did not allow identifying the existence of the market power, except when
only the four major companies had been considered. However, it was not possible to make
inferences on the exercise of the market power of the four major companies, since that the
main concern was regarding the possibility of the exercise, and not the exercise in fact.