Marketing of Agricultural Commodities in India

Marketing of Agricultural Commodities in India

Rakhi Arora (Jaipur National University, India)
Copyright: © 2017 |Pages: 28
DOI: 10.4018/978-1-5225-2475-5.ch008
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Abstract

Commodity market is a fast paced dynamic market with liquidity and Commodity Exchange providing a platform for trading in various agri and non agri commodities at nationalized exchanges for discovering the price of agricultural goods in India since 2003. This also provides an opportunity to farmers, manufacturers or individuals for hedging and arbitrage to minimizes the losses due to fluctuations in the futures as well as spot prices. Though the Government has taken many steps time to time to control the prices of listed commodities by imposing restrictions like imposing daily margin limits and banning futures trading in speculative commodity/commodities if required but it is still being questioned. This chapter emphasizes on the working of the National Level Commodity Exchanges in India in general, the share of major agricultural commodities traded across National Level Commodity Exchanges in India, the marketing mix for agricultural commodities in India and the benefits and challenges of commodity futures derivatives for investors in India.
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Objectives Of The Chapter

  • 1.

    Agricultural commodities are listed and traded at various commodity exchanges in India and globally as well. Readers would understand the working of the National Level Commodity Exchanges in India.

  • 2.

    Readers would come to know about the share of major agricultural commodities traded across National Level Commodity Exchanges in India.

  • 3.

    Readers would understand the marketing mix for agricultural commodities in India that how commodities are bought and sold at warehouses of commodity exchanges in India.

  • 4.

    The commodity exchanges provide benefits and challenges of commodity futures derivatives for investors in India.

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Introduction

Indian markets have provided a new opportunity for retail investors and traders, who want to diversify their portfolios beyond shares, bonds and real estate, to participate on commodity exchanges. The spectacular growth of commodity markets has also attracted many investors around the world to expand their investment to emerging markets like India, as more and more investors are realizing the potential opportunities of these markets. Like any other market, the commodity market also plays a vital role in risk management of derivatives.

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