A Review of an Empirical Study on Wheat Price Indexing with Reference to Indian Context

Abstract

In general, there is disagreement in the empirical research about the effects of agricultural commodities derivatives. Dealing in spot markets. The present review aimed to experimentally investigate how derivative trading affects price of wheat in both the future and spot markets. It studies a long-term price discovery of assets between the future and spot markets. The presence of long-term equilibrium amidst the futures and spot markets are ascertained by the test of Johansen cointegration. The findings demonstrate that a long-term equilibrium connection in wheat. The findings showed that future markets were a major source of price signals for the current market. By supporting improved infrastructure features including cheap warehousing costs, receipts and electronic spot exchange, the government may encourage hedgers to participate in the future market and deepen the markets.