ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Articles By Debasish Maitra

Electronic Agricultural Spot Markets

The electronic spot market has introduced technological innovations to agricultural commodity market trading through the electronic National Agriculture Market. To assess the role of the electronic spot market in price discovery, this paper explores the price efficiency test between select commodities’ spot and futures markets. While we find that the spot plays an instrumental role in price formation and transmission in selected markets, eNAM is yet to augment price-setting for farmers. We propose improvisations in the spot market design that align institutional structures, governance mechanisms and incentives and strengthen spot market infrastructure to enhance farmer participation.

Options and the Commodity Market

The necessity of options in commodity markets in India has been discussed for a long time. It aids in improving market liquidity, information transmission, and acts as a risk transfer mechanism. However, given the nature of farm and non-farm commodity markets, fi nancial investors may be attracted more towards non-farm commodity options. This would eventually lead to illiquidity in farm commodities. The regulator and exchanges should therefore work in unison to launch options in a prudent manner, especially in farm commodities, to benefi t the concerned stakeholders, including producer groups and processors.