Sunflower Market Cointegration Analysis - A Market Intelligence Tool for MarketingDecisions

摘要

The seasonal price indices showed marked difference in movements of wholesale prices in selected markets, while Chitradurga and Akola reported higher prices during November to March and June to August months, Vellakoil market reported higher prices from May to October months. Maharashtra being the major oil hub has shown more pronounced seasonality in their markets compared to Andhra Pradesh and Karnataka. The statistical analysis for assessing market integration was carried out in three steps viz.,testing for the order of integration, investigating pair-wise sunflower market time series prices cointegration utilizing the Johansen's maximum likelihood approach and application of Error Correction Model (ECM) to study the short run dynamics and causality of the model. Eigen value indicated the presence of at least one integration equation at 5 per cent level of significance. Hence, it is concluded that markets are having long run equilibrium relationship. The Granger causality result showed one-wayinfluence of markets of Andhra Pradesh, Tamil Nadu and Maharashtra on Karnataka market prices. Thus, the largest market of sunflower in India, viz., Chitradurga was found to be influenced by the prices in all the other major sunflower markets.