International Journal of Pure & Applied Bioscience (IJPAB)
Year : 2017, Volume : 5, Issue : 5
First page : (863) Last page : (871)
Article doi: http://dx.doi.org/10.18782/2320-7051.5047
Price Behaviour and Forecasting of Cotton in Telangana
R. Vijaya Kumari1, Venkatesh Panasa2 and Ramakrishna Gundu3 and Kaviraju S.4
Department of Agricultural Economics, College of Agriculture, Professor Jayashankar Telangana State Agricultural University, Hyderabad-500030
*Corresponding Author E-mail: venkyagrico@gmail.com
Received: 24.06.2017 | Revised: 28.07.2017 | Accepted: 5.08.2017
ABSTRACT
Cotton is the most important cash crop in Telangana. Area under cotton crop has increased in Telangana over a period of time continuously with the introduction of Bt cotton and also favorable market prices. Cotton area has increased from 11.60 lakh hectares in 2009-10 to 16.97 lakh hectares in 2015-16. To know the cotton price behaviour over the years and short term price forecast in Telangana we taken up the study on “Price Behavior of Cotton in Telangana”. The average monthly cotton price data of 16 years from 2002 April to May 2017 was used for price forecasting. Based on percentage share of total commodity arrivals 5 major markets are Warangal, Adilabad, Bainsa, Peddapalli and Karimnagar selected. In order to assess the presence of price fluctuation in the cotton prices in five major markets, ARCH-GARCH analysis was carried out. The results of ARCH-GARCH analysis indicate that the sum of Alpha and Beta is not nearer to 1 in any of major market for all the selected markets. This clearly indicates that the volatility shocks are not quite persistent in major markets for cotton. Monthly average prices (Rs/Quintal) of cotton in selected markets from January 2014 to December 2016 revealed that cotton prices were found to be maximum during the months March to May and also October, while remaining almost stable during the rest of the months. The monthly average data from 2002 to 2016 results show that cotton prices increasing year by year high prices are present at March 2011 (Rs. 5381), monthly average for overall years is very high present in the month of February and Yearly average for overall months is very high present in the year 2016. ARIMA 212 results revealed that price forecasting of cotton for the harvesting months i.e. November, December and January as followed Rs. 4889, 4824 and 4842 per quintal respectively.Based on the past 16 years data i.e. April 2002 to May 2017 and ARIMA 212 model the forecasted price showed that increasing trend in Warangal market.
Key words: Stationarity, Differencing, Volatility, ARIMA, ARCH-GARCH, Price forecast
Full Text : PDF; Journal doi : http://dx.doi.org/10.18782
Cite this article: Kumari, R.V., Panasa, V. and Gundu, R. and Kaviraju, S. Price Behaviour and Forecasting of Cotton in Telangana, Int. J. Pure App. Biosci.5(5): 863-871 (2017). doi: http://dx.doi.org/10.18782/2320-7051.5047
