INTEGRATION OF CUMIN MARKETS IN RAJASTHAN

KWASI RICHARD BANNOR¹*, MADHU SHARMA², SURJEET DHAKA^3
1Department of Agricultural Economics, Agribusiness and Extension, University of Energy and Natural Resources, Sunyani, Ghana
²Directorate of Prioritization, Monitoring and Evaluation, SK Rajasthan Agricultural University, Bikaner, 334006, Rajasthan, India
³Institute of Agribusiness Management, SK Rajasthan Agricultural University, Bikaner-334006, Rajasthan, India
* Corresponding Author : bannor46@yahoo.com

Received : 21-08-2016     Accepted : 04-09-2016     Published : 30-10-2016
Volume : 8     Issue : 52       Pages : 2516 - 2520
Int J Agr Sci 8.52 (2016):2516-2520

Keywords : Cumin, ECM, Market Integration, Rajasthan and VAR
Academic Editor : Dr Amita Sharma
Conflict of Interest : None declared
Acknowledgements/Funding : None declared
Author Contribution : None declared

The study investigated the integration between cumin (Cuminum cyminum) markets pairs in Rajasthan State using monthly cumin price series of five (5) markets from 2008-2015. The co-integration tests results indicate Nagaur and Pali; Nagaur and Jodhpur; Nagaur and Jalore markets are integrated in the long run at lag five (5). However, the rest of other market pairs are not integrated in the long run. The results from the error correction model showed that, the lowest speed of adjustment towards long run equilibrium was from Nagaur to Jalore market at rate of 37.4%. The highest speed of adjustment was 56.6%, running Nagaur to Pali market towards long run equilibrium. This is followed by a speed of adjustment of 45.1% running from Nagaur to Jodhpur market towards along run equilibrium in a period of at most one (1) month. The results further indicate bidirectional causality between Nagaur and Pali markets and also Naguar and Jalore markets. There is also a unidirectional causality of price change from Merta City market of Nagaur to Bhagat Ki Kothi market of Jodhpur but not vise-versa. The results from the unrestricted vector autoregressive (VAR) model was run for market pairs that were not cointegrated that cumin price series between Ajmer and Jodhpur; Jodhpur and Pali and Jodhpur and Jalore Granger causes each other in the short run whereas Ajmer Granger causes Nagaur, Pali and Jalore in less than one month though in the long run they drift apart. The study further reveal that orthogonalized shock or unexpected shocks to Nagaur market will result in permanent effect on the prices of other selected markets within one year. In the same way, unexpected shock to market prices of Pali will result in permanent price effect on Nagaur cumin prices but temporary on prices in Jodhpur. On the other hand unexpected shock to prices of Ajmer will results in transitory or temporary price effect on prices in Pali, Nagaur, Jodhpur and Jalore markets.