Efficiency of Indian Commodities Market: A Study of Agricultural Commodity Derivatives Traded on NCDEX

Kaur, Gurbandini; Rao, D. N.

doi:10.2139/ssrn.1600687

Cited by 8 publications

(5 citation statements)

References 19 publications

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“…Singh (2010) find that guar gum, guar seed, and castor seed spot and futures markets are cointegrated and unbiased. Similar results were reported by Kaur and Rao (2010) in their study on the weak form efficiency futures markets. They conclude that guar seed, chana, and pepper commodities futures markets were efficient.…”

Section: Literature Reviewsupporting

confidence: 90%

Empirical Investigation on Food Inflation and Efficiency Issues in Indian Agri-futures Market

Singh

2017

Emerging Economy Studies

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In early 2007, the Government of India (GoI) banned futures trading on some essential agro-commodities such as wheat, rice, and two varieties of lentils due to rising food inflation. However, futures trading in agri-commodities such as chana (chickpea), soy oil, rubber, and potato were temporarily suspended. Professor Abhijit Sen’s committee, constituted to study the relationship between futures trading and agricultural commodities inflation, did not find sufficient evidence of inflationary impact of futures trading in India due to too short period of commodity futures trading. Also, an efficient futures market is required for the producers, traders, and consumers to hedge their price risk. Thus, in this study, we analyze the market efficiency of agricultural futures market and the effect of futures trading on inflation with special reference to chana (chickpea) market in India. This study is for a time frame of 10 years from 2005–2014. The data on closing prices of chana in futures and spot markets and futures trading volume has been collected from National Commodity and Derivatives Exchange, and chana wholesale price index (WPI) monthly data from Office of the Economic Adviser, GoI. The collected data is analyzed for efficiency using Johansen cointegration approach and vector error correction (VEC) restrictions and inflationary effect using Toda Yamamoto (TY) version of Granger causality test. From the results, we find that the spot and futures prices for chana are cointegrated and unbiased, that is, the chana (chickpea) futures market is efficient. But, the futures trading of chana has inflationary impact, that is, futures trading volume of chana affects chana WPI. This research has got direct implications for government and market participants. India is the largest consumer of chana (chickpea)—the third most important pulse crop produced in the world. Thus, the inflationary impact of chana futures trading is a matter of concern for GoI.

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Section: Literature Reviewsupporting

confidence: 90%

Empirical Investigation on Food Inflation and Efficiency Issues in Indian Agri-futures Market

Singh

2017

Emerging Economy Studies

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“…According to Kaur et al [9], product and futures prices for selected agricultural commodities closely tracked one another, with no signi cant differences observed in futures and spot contract prices for agricultural products. Chakrabarty et al [10] surveyed many papers on the Indian product market in terms of price and import-export exchanges.…”

Section: Related Workmentioning

confidence: 98%

“…Nath et al [32] structured the agricultural product trading futures contract, which has resulted in a price increase; the product trading days, selected commodity price, and volatility have all increased signi cantly. Kaur et al [33] analyzed the spot price for agricultural products and the price for those agricultural products in an organized manner.…”

Section: Tian Et Almentioning

confidence: 99%

Implementation of circular blockchain-based approach for food crops supply chain with bitcoin prediction using deep learning

2023

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Blockchain technology serves as a framework for addressing the challenge of tracking and marketing materials in distributed networks. Agricultural traceability systems in food production provide farmers with food safety and smart contracts. Smart contracts establish cryptocurrency evidence of delivery with automated bitcoin payments to all parties. In this paper, we propose circular blockchain-based traceability and bitcoin prediction in agricultural food crop system to accomplish transparency and traceability. Bitcoin prediction using LSTM bene ts farmers and stakeholders to buy and sell their food crops when the pro t is high. Moreover, the proposed system provides safety, consensus, shared ledger, speedy payment, and decentralization. All activities are processed in a distributed shared ledger with connections to a decentralized le system, which makes the supply chain visible and traceable. All the activities that are tied up in the supply chain are transparent to consumers and stakeholders. Traceability of the agricultural product is done e ciently with QR code, which results in a trustable relationship between the farmer and the consumer. Finally, our research shows that the accuracy of LSTM outperforms by 88.67% compared to traditional machine learning algorithms such as SVM and Naive Bayes with accuracy of 62.025% and 75.32% in forecasting the bitcoin price.

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“…These exchanges are offering the benefits of liberalization and globalization directly to the industry and consumers by empowering them to influence the global prices of commodities they deal in. Moreover, a study by Kaur and Rao (2010) pointed out that Indian commodity derivative market has witnessed phenomenal growth in few years by achieving almost 50 times growth in market, whereas Kapil and Kapil (2010) found an unstructured market expansion in Indian commodity markets, in spite of high demand for commodities in both derivative and spot markets (see Table 1). Found a high potential for future growth of Indian commodity futures market as India is one of the top producers of agricultural commodities.…”

Section: Growth and Developmentmentioning

confidence: 99%

Indian Agri-Commodities Markets: A Review of Transition Toward Futures

Kar

2021

Journal of Operations and Strategic Planning

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By using indications given by the commodity markets, farmers, growers, or producers can minimize the price risk and avoid a supply gut. The consumers of the output can minimize the price risk and ensure that the demand pressure is appropriately capped. It was in this backdrop that farmers and food grain merchants initiated futures markets in agri-commodities. This article has been successful in documenting the evolution of agri-commodities futures markets in India and their regulatory framework. It also captures the transition toward agri-commodities futures by engaging in a comprehensive survey of extant literature. The market growth analysis indicates that the transition toward agri-commodities futures markets has enabled price discovery and better price risk management. While ensuring price risk mitigation and remunerative returns, these markets also contribute to scaling down the downside risks associated with agricultural lending and, thereby, facilitate the flow of credit to agriculture. Further, they also hold a key role not only in reinvigorating the spot markets but also in triggering the diversified growth of Indian agriculture in line with the consumption pattern. Thus, enabling policies need to be put in place to strengthen the agri-commodities futures markets by streamlining the supply chain.

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Efficiency of Indian Commodities Market: A Study of Agricultural Commodity Derivatives Traded on NCDEX

Cited by 8 publications

References 19 publications

Empirical Investigation on Food Inflation and Efficiency Issues in Indian Agri-futures Market

Empirical Investigation on Food Inflation and Efficiency Issues in Indian Agri-futures Market

Implementation of circular blockchain-based approach for food crops supply chain with bitcoin prediction using deep learning

Indian Agri-Commodities Markets: A Review of Transition Toward Futures

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