An Empirical Study On Socioeconomic Factors Affecting Producer’s Participation In Commodity Markets In India

Abstract

India is an agricultural country, and agricultural goods and trade are vital to its economy. It has been decades since India's small and marginal farmers' pricing risk was reduced through better agricultural marketing. A futures market was created to stabilize prices, decrease poverty, and promote economic growth. Investors can use future derivatives to protect their cash market positions. Agricultural commodities futures market has yet to garner considerable producer participation. A survey was conducted in Karnataka state by producers involved in a variety of crops using a blend of judgement and convenient sampling method. MS Excel and IBM SPSS 20 were used as statistical software. A logit model revealed the primary determinants impacting commodity futures adoption in the area. It tries to identify institutional, socioeconomic, and farmer involvement factors that hinder or promote farmer participation in futures markets in India and Abroad.