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PRICE ANALYSIS OF EDIBLE OILS IN INDIA

KrishiKosh

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Title PRICE ANALYSIS OF EDIBLE OILS IN INDIA
 
Creator ANUSHA, R
 
Contributor SUHASINI, K
 
Subject marketing, oils, productivity, crops, biological development, plant oils, seasons, markets, groundnuts, area
 
Description Price analysis of edible oils in India is done using the required data according to the
study purpose collected from several secondary data base. All edible oilseed crops
producing entire edible oil in India like sunflower, rapeseed and mustard, groundnut,
safflower, soybean and sesamum except palm oil are considered for the study. There is a
demand and supply gap in case of edible oils and analysis on prices of edible oils is very
important in balancing them. Since edible oil prices influence the prices of crop produce,
the present study is undertaken.
Specific objectives of the study are to estimate the seasonal and cyclical
fluctuations in prices of edible oils, to examine the impact of price fluctuations on
production of edible oilseed crops, to estimate growth and variability of oilseeds
production and to forecast future prices of edible oils. In order to study price fluctuations
and to forecast prices monthly wholesale prices from 1989 to 2011, to estimate growth and
variability production data from 1971 to 2010 and to examine impact of price fluctuation
on production various data bases like previous year‟s price, previous year‟s production,
south west monsoon rainfall, previous year‟s price of competing crops from 1993 to 2010
were used.
To estimate seasonal fluctuations of the edible oils „ratio to moving average
method‟ is used and to estimate cyclical fluctuations „residual method‟ is used. The
seasonal and cyclical indices are calculated and are analysed for their effect on wholesale
prices of respective oils. A comparison of the seasonal factors for the edible oils shows that
the band of seasonality is in between 7 to12. The results indicate that band of seasonality
was the highest in the case of groundnut oil while lowest was in case of sunflower oil.
Highest variation in seasonal indices is observed for groundnut oil price indices followed
by mustard oil. Lowest variation is observed for sunflower oil price indices. Price peaks
coincided with 8-10 months after crop harvesting in majority of the edible oils, indicating
that farmers can use storage facilities and sell the produce after minimum of nine months
(sunflower oil, groundnut oil, soybean oil), eight months (rapeseed and mustard oil) and
even less up to one month (safflower oil) in few crops.
The cyclical indices of edible oils show variation in between 97.83 to 100.16. Of all
the edible oils, low cyclical variation is seen in groundnut and safflower oil and high
cyclical variation is seen in soybean and sunflower oil. The cyclical pattern is irregular in
safflower, soybean and sesamum. Regular pattern is observed in groundnut (two peaks
during 2002-2006 and 2006-2010) and with minimum variation in rapeseed and mustard
(similar peaks during 1995-2005 and 2005-2010). As per the cyclical indices analysis there
are cyclical variations observed, more cyclical variations observed, more cyclical
variations across years were found in groundnut, rapeseed and mustard, soybean compared
to sunflower, safflower and sesamum oil prices. There can be more volatility of edible oil
prices where the cyclical variations of pronounced as in case of groundnut, rapeseed and
mustard and soybean which have long run price implications.
Among all the edible oilseed crops, the influence of lagged price is positive and
significant on the production of mustard, sunflower and groundnut. The previous year‟s oil
price has positive but non significant influence on sesamum current year‟s production.
Previous year‟s oil price has negative significant influence on safflower. Similarly,
soybean oil price of last year has a negative non significant influence on current year‟s
production. This confirms that among the edible oils considered sunflower, groundnut and
mustard production has greater response to price changes, as these are the major edible oils
occupying 80 percent of consumption.
During sub period I (1971 – 1990) crops registered positive compound growth were
in the order of soybean, sunflower, safflower, rapeseed and mustard and sesamum.
Groundnut suffered from lowest compound growth during sub period I, even though
popularly consumed. During sub period II, soybean the only crop registered highest
significant positive growth rate with rapeseed and mustard registering a low non
significant growth in production. This indicates the immense potential in soybean for
expansion in future as a substitute for major edible oils also.
The prices forecasted with ARIMA model showed increasing trend for must ard,
groundnut, safflower and soybean oil prices, while a oscillating prices and policy makers
to consider this fact while placing for price stabilization (MSP) and crop specific
programmes.
Thus the present study suggested focus on soybean crop improvement, research to
be prioritised on groundnut improvement of cultivars, advocates favourable time to the
farmers to sell their produce and suggests cold storage facilities. However oilseeds require
integrated water management, regional approach and individual focus to promote the area
and productivity expansion in the targeted areas.
 
Date 2016-06-23T09:00:13Z
2016-06-23T09:00:13Z
2012
 
Type Thesis
 
Identifier http://krishikosh.egranth.ac.in/handle/1/67761
 
Language en
 
Relation D9130;
 
Format application/pdf
 
Publisher ACHARYA N.G. RANGA AGRICULTURAL UNIVERSITY