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Agriculture markets in India

Agriculture is one of the most critical sectors of Indian economy. One third

population depends on the agricultural sector directly or indirectly. Agriculture

remains as the main stray of the Indian economy since times immemorial. Indian

agriculture contribution to the national gross domestic product (GDP) is about 25

per cent. With food being the crowning need of mankind, much emphasis has

been on commercialising agricultural production. For this reason, adequate

production and even distribution of food has of late become a high priority global


Agricultural marketing is mainly the buying and selling of agricultural products.

In earlier days when the village economy was more or less self-sufficient the

marketing of agricultural products presented no difficulty as the farmer sold his

produce to the consumer on a cash or barter basis.

Today's agricultural marketing has to undergo a series of exchanges or transfers

from one person to another before it reaches the consumer. There are three

marketing functions involved in this, i.e., assembling, preparation for

consumption and distribution. Selling on any agricultural produce depends on

some couple of factors like the demand of the product at that time, availability of

storage etc. The products may be sold directly in the market or it may be stored

locally for the time being. Moreover, it may be sold as it is gathered from the

field or it may be cleaned, graded and processed by the farmer or the merchant of
the village. Sometime processing is done because consumers want it, or

sometimes to conserve the quality of that product. The task of distribution system

is to match the supply with the existing demand by whole selling and retailing in

various points of different markets like primary, secondary or terminal markets.

Most of the agricultural products in India are sold by farmers in the private sector

to moneylenders (to whom the farmer may be indebted) or to village traders.

Products are sold in various ways. For example, it might be sold at a weekly

village market in the farmer's village or in a neighbouring village. If these outlets

are not available, then produce might be sold at irregularly held markets in a

nearby village or town, or in the mandi.

In India, there are several central government organisations, who are involved in

agricultural marketing like, Commission of Agricultural Costs and Prices, Food

Corporation of India, Cotton Corporation of India, Jute Corporation of India, etc.

There are also specialised marketing bodies for rubber, tea, coffee, tobacco,

spices and vegetables.

Under the Agricultural Produce (grading and marketing) Act of 1937, more than

forty primary commodities are compulsorily graded for export and voluntarily

graded for internal consumption. Although the regulation of commodity markets

is a function of state government, the directorate of marketing and inspection

provides marketing and inspection services and financial aid down to the village

level to help set up commodity grading centers in selected markets.

Lack of storage facility, distress sale, lack of transportation, intermediaries,

unregulated markets etc. these are some of the factors effecting agriculture

marketing in India to overcome this regulated markets are established.

A commodity is an economic good or service that has full or substantial

fungibility: that is, the market treats instances of the good as equivalent or nearly

so with no regard to who produced them. The price of a commodity good is

typically determined as a function of its market as a whole. Most commodities are

raw materials, basic resources, agricultural, or mining products, such as iron ore,

sugar, or grains like rice and wheat.

A commodity derivative market is a physical or virtual marketplace for buying,

selling, and trading raw or primary products. Where it is a contract between two

or more parties whose value is based on an agreed upon underlying financial

assets. There are currently about 50 major commodity markets worldwide that

facilitate trade in approximately 100 primary commodities


Commodities are divided in to two types. Hard and soft commodities.


Hard commodities are typically natural resources that must be mined or

extracted—such as gold, rubber, and oil, whereas soft commodities are

agricultural products or livestock—such as corn, wheat, coffee, sugar, soybeans,

and pork.

Soft commodities refers to future contracts where the actuals are grown rather

than the extracted or mined. Soft commodities represent some of the oldest types

of futures know to have been actively traded. This storied group includes cotton

,sugar, rice and wheat as well as all the matters of livestock. Soft commodities

sometimes referred as tropical commodity or food and fibre commodities.


In this fast growing competitive market scenario, it is always required to have an

idea of changes that are taking place in the market from time to time. Without

which we can serve our customers properly. With the awareness that is increasing

day by day about keeping investments in Stock markets particularly in Equity,

Derivatives Markets and Commodity markets.

The comfort and flexibility the customers seeking, there is a definite requirement

to study how E-broking will give more user-friendly support in keeping

investments in Equity, Derivatives Markets and Commodity markets. The need of

the study is to maintain the commodity risk and to know the demand and supply

of the commodity.

Markets for financial derivatives and commodities have grown tremendously in

the recent years. Many broking companies have emerged only after the start of

trading in futures and options.


The methodology implemented for the on-line trading process is logging on to the

ODIN screen by filling the User ID, Trading Member ID, Password and New

Password. After logging on the Title bar, Ticker Window, Tool Bar, Market

Watch, Inquiry Window, Order/Trade Window and Message Window is

displayed. Using these windows, the user can buy or sell the shares by placing

the orders, quoting the price and the quantity of the shares. For example, Fig.1

represents ODIN Login Screen and the Fig.2 ODIN Market Watch Screen.


Primary data was for different scrip were taken from three different sectors and

studied the factors that are affecting the scrip movement. The primary data was

collected by watching the daily trade.

Secondary data is already published data collected for some purposes other than

the one confronting the researcher at a given point of time. The secondary data

can be gathered from various sources like books, journals, research agencies etc.

For this project the secondary information is collected from the various sources

like Business Line & Economic Times” (news papers); and the MCXINDIA

website in the internet.

The information regarding the online trading is collected from

 http://www.steelcitynettrade.com

 https://www.ncdex.com/index.aspx

 https://www.mcxindia.com

Some other sources are:

 SEBI annual reports

 Agriculture commodity reports


Due to the confidential policy of the organization, we couldn’t get more


Due to the busy schedule of the manager, we couldn’t interact more.

As the investors are not completely unaware of the proceedings of procedure

in online trading.

The process is complicated in nature of online trading.

Detailed study is not possible due to lack of information.



Deals with introduction, need and significance of the study, objectives of the

study, research methodology, limitations and framework of the study.


Deals with industry and company profile


Deals with 2 sections

Section A: conceptual review of the study

Section B: Journal reviews


Deals with data analysis and interpretation


Includes summary, findings and suggestions.