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Author: Tirtha Chatterjee
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Farmers, especially small and marginal, do not directly trade in agri-futures market in India. Their small size, lack of trust and understanding of futures market and dependence on middlemen, are some of the main deterrents. The role of Farmer Producer Organizations (FPOs) is crucial in this context since they can procure commodities, aggregate them and ensure that size and quality standards required for agri-futures trade are met. In her Budget speech for Union Budget of FY20, the Union Finance Minister has set a target of creating 10,000 FPOs in the next five years (by 2024). NABARD has already been in this process of creating FPOs for the last few years (already has more than 3000 FPOs) and the major responsibility of scaling them with 10,000 new ones, is likely to fall on NABARD. Interestingly, NCDEX has also been trying to deepen FPOs participation in markets for the last few years. However, as our analysis shows that between April 2016 and May 2018 only a tiny fraction (0.004 percent) of overall agri-futures trade at NCDEX was through FPOs. This reflects the need for gigantic steps, if FPOs have to be involved in futures trading at any reasonable scale. The need is even greater if one considers the dire necessity of having forward looking cropping patterns, where farmers' planting decisions are based on future prices rather than last year's or even earlier year's prices. Keeping this in mind, the paper identifies the constraints in first linking farmers to FPOs and second, FPOs to futures market. Based on this research about constraints, the paper puts forward a few suggestions for the FPOs, NCDEX, as well as the government for better results: (1) Both FPOs and NCDEX need to focus initially on commodities not pereceived by the Government as 'sensitive' from food security point of view so that minimum disruption takes place in futures markets. This will help them gain confidence in the functioning of futures markets; (2) NCDEX needs to identify production centres, build delivery centres around them and encourage futures trading in these areas; (3) Resource Institutions involved in educating and hand-holding FPOs in futures trading, themselves need to upgrade their knowledge and skills about functioning of futures trading. Government policy and NCDEX both can help them in this direction; (4) Government initiatives like that of Bihar and Rajasthan can help scaling the efforts of linking FPOs to futures markets in other regions, (5) There could also be learning from small holder dominated agriculture of China, that has provided state support in linking farmers to futures, and helped customized products and reduce price distortions, (6) Government's trading arms can also be encouraged to directly participate in the futures market to give confidence to many others, including FPOs; and (7) Instruments like forwards and options have to be encouraged to invite greater participation by FPOs.
Author: Tirtha Chatterjee
Publisher:
ISBN:
Category :
Languages : en
Pages :
Get Book Here
Book Description
Farmers, especially small and marginal, do not directly trade in agri-futures market in India. Their small size, lack of trust and understanding of futures market and dependence on middlemen, are some of the main deterrents. The role of Farmer Producer Organizations (FPOs) is crucial in this context since they can procure commodities, aggregate them and ensure that size and quality standards required for agri-futures trade are met. In her Budget speech for Union Budget of FY20, the Union Finance Minister has set a target of creating 10,000 FPOs in the next five years (by 2024). NABARD has already been in this process of creating FPOs for the last few years (already has more than 3000 FPOs) and the major responsibility of scaling them with 10,000 new ones, is likely to fall on NABARD. Interestingly, NCDEX has also been trying to deepen FPOs participation in markets for the last few years. However, as our analysis shows that between April 2016 and May 2018 only a tiny fraction (0.004 percent) of overall agri-futures trade at NCDEX was through FPOs. This reflects the need for gigantic steps, if FPOs have to be involved in futures trading at any reasonable scale. The need is even greater if one considers the dire necessity of having forward looking cropping patterns, where farmers' planting decisions are based on future prices rather than last year's or even earlier year's prices. Keeping this in mind, the paper identifies the constraints in first linking farmers to FPOs and second, FPOs to futures market. Based on this research about constraints, the paper puts forward a few suggestions for the FPOs, NCDEX, as well as the government for better results: (1) Both FPOs and NCDEX need to focus initially on commodities not pereceived by the Government as 'sensitive' from food security point of view so that minimum disruption takes place in futures markets. This will help them gain confidence in the functioning of futures markets; (2) NCDEX needs to identify production centres, build delivery centres around them and encourage futures trading in these areas; (3) Resource Institutions involved in educating and hand-holding FPOs in futures trading, themselves need to upgrade their knowledge and skills about functioning of futures trading. Government policy and NCDEX both can help them in this direction; (4) Government initiatives like that of Bihar and Rajasthan can help scaling the efforts of linking FPOs to futures markets in other regions, (5) There could also be learning from small holder dominated agriculture of China, that has provided state support in linking farmers to futures, and helped customized products and reduce price distortions, (6) Government's trading arms can also be encouraged to directly participate in the futures market to give confidence to many others, including FPOs; and (7) Instruments like forwards and options have to be encouraged to invite greater participation by FPOs.
Author: Kushankur Dey
Publisher: Springer Nature
ISBN: 9811634327
Category : Business & Economics
Languages : en
Pages : 145
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Book Description
Futures markets offer numerous advantages in the marketing of agricultural commodities, and in this context, the book examines the major factors and issues that determine the participation of India’s farmers in the futures markets. These include the efficiency of the futures markets in price discovery, the convergence of spot and futures prices, the dissemination of spot price information, and the socio-economic and exchange-related issues affecting farmer participation. It also examines the factors affecting the demand and supply of participation, and the access to futures trading services. The purpose is to identify different factors that can enhance or constrain farmer participation in the futures markets, which may include market characteristics, institutional features, socio-economic issues, and behavioural aspects of farmer participation. A number of organizations related to rural development, as well as farmer producer companies have sought to facilitate farmer participation in the forward/futures market through offering aggregation and other trading services, and the book also examines these efforts towards the exchange-traded derivative markets and the direct and indirect benefits that accrue. The book also studies the efficiency of futures markets in price discovery and price dissemination applying co-integration tests, and error correction and volatility models, using available data of wheat, rapeseed-mustard, cotton, guar seed, castor, cumin and coriander futures contracts traded in the largest agricultural commodity exchanges in India. Besides, case studies are used to examine and understand the institutional roles of aggregators in aggregation efforts towards the forward/futures market. This book covers several states and locations in India to enhance the representation and validity of the findings. It also examines representative farmer organizations which have obtained institutional membership in the forward or futures markets, and identifies areas of further research. In the current scenario, the book would be of immense importance and relevance to governments, commodity exchanges/markets, aggregators, many private and development organizations, as well as interested researchers and students.
Author: Kushankur Dey
Publisher:
ISBN: 9789811634338
Category :
Languages : en
Pages : 0
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Book Description
Futures markets offer numerous advantages in the marketing of agricultural commodities, and in this context, the book examines the major factors and issues that determine the participation of India's farmers in the futures markets. These include the efficiency of the futures markets in price discovery, the convergence of spot and futures prices, the dissemination of spot price information, and the socio-economic and exchange-related issues affecting farmer participation. It also examines the factors affecting the demand and supply of participation, and the access to futures trading services. The purpose is to identify different factors that can enhance or constrain farmer participation in the futures markets, which may include market characteristics, institutional features, socio-economic issues, and behavioural aspects of farmer participation. A number of organizations related to rural development, as well as farmer producer companies have sought to facilitate farmer participation in the forward/futures market through offering aggregation and other trading services, and the book also examines these efforts towards the exchange-traded derivative markets and the direct and indirect benefits that accrue. The book also studies the efficiency of futures markets in price discovery and price dissemination applying co-integration tests, and error correction and volatility models, using available data of wheat, rapeseed-mustard, cotton, guar seed, castor, cumin and coriander futures contracts traded in the largest agricultural commodity exchanges in India. Besides, case studies are used to examine and understand the institutional roles of aggregators in aggregation efforts towards the forward/futures market. This book covers several states and locations in India to enhance the representation and validity of the findings. It also examines representative farmer organizations which have obtained institutional membership in the forward or futures markets, and identifies areas of further research. In the current scenario, the book would be of immense importance and relevance to governments, commodity exchanges/markets, aggregators, many private and development organizations, as well as interested researchers and students.
Author: Prabhu Pingali
Publisher: Springer
ISBN: 3030144097
Category : Business & Economics
Languages : en
Pages : 382
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Book Description
This open access book examines the interactions between India’s economic development, agricultural production, and nutrition through the lens of a “Food Systems Approach (FSA).” The Indian growth story is a paradoxical one. Despite economic progress over the past two decades, regional inequality, food insecurity and malnutrition problems persist. Simultaneously, recent trends in obesity along with micro-nutrient deficiency portend to a future public health crisis. This book explores various challenges and opportunities to achieve a nutrition-secure future through diversified production systems, improved health and hygiene environment and greater individual capability to access a balanced diet contributing to an increase in overall productivity. The authors bring together the latest data and scientific evidence from the country to map out the current state of food systems and nutrition outcomes. They place India within the context of other developing country experiences and highlight India’s status as an outlier in terms of the persistence of high levels of stunting while following global trends in obesity. This book discusses the policy and institutional interventions needed for promoting a nutrition-sensitive food system and the multi-sectoral strategies needed for simultaneously addressing the triple burden of malnutrition in India.
Author: Sriganesh Lokanathan
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
Farmers in developing countries are often unable to engage effectively in agricultural markets in their countries since these markets are prone to inefficiencies (Barret, 2005; Fafchamps, 2004; World Banks, 2002 amongst others). Small and subsistence farmers in particular tend to have unfavorable linkages to markets due to a lack of market orientation (Timmer, 1997). The commercialization of agriculture and the subsequent structural complexity it has induced in the food system has meant that poor farmers face higher transaction costs to access competitive markets (Pingali et al, 2005; Pingali, 2006). The lack of effective engagement translates into the inability of farmers to utilize market information in their livelihood decisions. These suboptimal decisions in turn restrict the possibility for farmers to leverage their produce or commodities to improve and sustain their incomes, by engaging, for instance, in financial instruments such as forward contracts. The inability to enter into such contracts precludes them from access to crop insurance and working capital loans using their produce as collateral (e.g., a forward contract or commodity backed financing using warehouse receipts). Providing access to accurate and timely market price information without physically visiting markets is the first step in reducing the transaction costs and allowing farmers to engage effectively in agricultural markets. Ratnadiwakara et. al., (2008) argue that provision of market price information in a timely manner reduces information asymmetry, which in turns allows farmers to reduce their transaction costs while also increasing their bargaining power in market transactions (also Jaleta & Gardebroek, 2007). A crucial benefit of having access to market price information (especially forward and/or future prices) is that it gives farmers more control over their crop planting and harvesting schedules which they can then optimize so as to align their agricultural outputs to meet the demand in local and external markets. This in turn would help facilitate a more stable revenue stream from their produce. ICTs can play an important role in bridging the information deficiencies and can provide access to markets. From pure market price dissemination to more sophisticated systems that link farmers to output markets, ICTs can play an important developmental role. Its potential as a poverty alleviation tool has been recognized and countless examples exist in the developing world of initiatives to improve farmers' livelihoods via ICT driven linkages to markets.
Author: Ashok Gulati
Publisher: Springer Nature
ISBN: 9813342684
Category : Business & Economics
Languages : en
Pages : 324
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Book Description
This open access book provides a clear holistic conceptual framework of CISS-F (competitiveness, inclusiveness, sustainability, scalability and access to finance) to analyse the efficiency of value chains of high value agricultural commodities in India. It is based on the understanding that agriculture is an integrated system that connects farming with logistics, processing and marketing. Farmer’s welfare being central to any agricultural policy makes it very pertinent to study how a value chain works and can be strengthened further to realize this policy goal. This book adds value to the existing research by studying the value chains end-to-end across a wide spectrum of agricultural commodities with the holistic lens of CISS-F. It is not enough that a value chain is competitive but not inclusive or it is competitive and inclusive but not sustainable. The issue of scalability is very critical to achieve macro gains in terms of greater farmer outreach and sectoral growth. The research undertaken here brings out some very useful insights for policymaking in terms of what needs to be done better to steer the agricultural value chains towards being more competitive, inclusive, sustainable and scalable. The value chain specific research findings help draw very nuanced policy recommendations as well as present a big picture of the future direction of policy making in agriculture.
Author: Carlos A. Da Silva
Publisher: Food & Agriculture Organization of the UN (FAO)
ISBN:
Category : Business & Economics
Languages : en
Pages : 236
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Book Description
This book aims to typify the extent to which contract farming is helping small farmers to access markets and meet increasingly stringent requirements, not only of "modern" food manufacturers, retailers, exporters and food service firms,by also in non-food sectors such as biofuels and forestry. It also seeks to clarify differences in the functionality of contracts depending on commodity, market, technology, public policies and country circumstances. Conceptual issues are discussed and a series of case study appraisals based on real world examples from developing regions are presented. The issuesraised by the case study authors and the key messages synthesized in the initial book chapter bring new insights and contributions to further enrich knowledge on contract farming as a tool for inclusive market access in development countries.
Author: Ashok Gulati
Publisher: Springer Nature
ISBN: 9811593353
Category : Business & Economics
Languages : en
Pages : 386
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Book Description
This open access book provides an evidence-based roadmap for revitalising Indian agriculture while ensuring that the growth process is efficient, inclusive, and sustainable, and results in sustained growth of farmers’ incomes. The book, instead of looking for global best practices and evaluating them to assess the possibility of replicating these domestically, looks inward at the best practices and experiences within Indian states, to answer questions such as -- how the agricultural growth process can be speeded up and made more inclusive, and financially viable; are there any best practices that can be studied and replicated to bring about faster growth in agriculture; does the prior hypothesis that rapid agricultural growth can alleviate poverty faster, reduce malnutrition, and augment farmers’ incomes stand? To answer these questions, the book follows four broad threads -- i) Linkage between agricultural performance, poverty and malnutrition; ii) Analysing the historical growth performance of agricultural sector in selected Indian states; iii) Will higher agricultural GDP necessarily result in higher incomes for farmers; iv) Analysing the current agricultural policy environment to evaluate its efficiency and efficacy, and consolidate all analysis to create a roadmap. These are discussed in 12 chapters, which provide a building block for the concluding chapter that presents a roadmap for revitalising Indian agriculture while ensuring growth in farmers’ incomes.
Author: C. Shambu Prasad
Publisher: Taylor & Francis
ISBN: 1000890589
Category : Business & Economics
Languages : en
Pages : 293
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Book Description
This book studies the management challenges and possibilities in sustaining farmer producer organisations (FPOs). It goes beyond the conventional metrics of cost-benefit analysis by drawing on 15 case studies of diverse FPOs spread across India to fill a significant knowledge-practice gap in the domain of producer collectives. The book explores issues of ownership and governance, studies the empirical basis for policy decisions on FPOs, and provides actionable insights and knowledge, keeping in mind the complexity of the institutional design of an FPO. It also discusses the envisioned role of civil society organisations in supporting FPOs and looks at the kind of institutional innovations that are needed to create a cohesive ecosystem for FPOs. A unique collaborative project jointly authored by academics and development practitioners, the book will be of use to students and researchers of agricultural economics, environment and business, agricultural development, environmental economics, rural studies, entrepreneurship, and South Asian studies. It will also be of interest to development professionals, civil society organisations, and policymakers.
Author: PRABINA RAJIB
Publisher: PHI Learning Pvt. Ltd.
ISBN: 8120348990
Category : Business & Economics
Languages : en
Pages : 458
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Book Description
Over the last decade, commodity derivatives trading in India has undergone a significant growth, and has surpassed equity derivatives trading. The book covers almost the entire spectrum of commodities traded in the Indian commodity market, including agricultural commodities, crude oil, base metal, precious metal, electricity, carbon, weather, freight, real estate, and water. A distinguishing feature of the book is that it lucidly explains the peculiarities of various commodities, delving into their technical and historical details. As commodity market in a country cannot function in isolation, commodity contracts traded in other international exchanges, like LME, CME, The Baltic Exchange, Nordpool, etc. have also been discussed in detail. Commodity derivatives contracts, such as futures, FRAs, options, Tapos, swaps, spreads (crush, crack, dark and spark), collars, ETFs, Contract for Differences (CfDs) and cool bonds, etc. have been discussed extensively in the book. Fundamental factors associated with different types of commodities have been dealt with to develop a deeper understanding of the peculiarities associated with various commodities. This book documents the case studies involving important commodity price manipulations and frauds in commodity derivatives trading. These have been analyzed to bring out the necessity and the role of the commodity market regulators in maintaining market integrity. Major commodity derivatives trading losses that have shaken up even some prominent companies all over the world have been discussed to highlight the risks associated with commodity derivatives trading. The book is intended for the postgraduate students of Management. It is equally beneficial for the students and professionals opting for Diploma courses in Banking and Finance.• Around 40 Business Snapshots have been presented at appropriate sections in the book, so that a reader can apply the concepts to real-life situations/happenings. • Around 100 Numerical Examples have also been worked in various chapters to help the reader develop a deeper understanding of the underlying theories. • Worked out examples and business snapshots have been provided in large numbers. • End of the chapter questions have been provided for the students to test their understanding. • Power Point slides available online at www.phindia.com/prabinarajib to provide integrated learning to the students.
