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Changing pattern of energy use in Indian agriculture and linkage between energy and commodity prices

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  • Jha, Girish
  • Kumar, Rajeev
  • Singh, Alka
  • Pal, Suresh

Abstract

The expenses on energy based inputs have registered a phenomenal increase since the 1990s in Indian agriculture. The use of energy intensive inputs is higher on marginal farms than on large farms. In view of increasing share of energy costs, this paper examined the transmission mechanism of increase in energy prices in agricultural commodity markets in India using monthly wholesale price indices during April 1994 to March 2014. In order to assess the effect of deregulation of some petroleum products since April 2002, study period was divided into two sub-periods (April 1994 to March 2004 and April 2004 to March 2014), besides analyzing for full period. The co-integration analysis indicated evidence of parallel movement between prices of energy and all selected agricultural commodities after deregulation, which means higher transmission between crude oil and these commodity prices.

Suggested Citation

  • Jha, Girish & Kumar, Rajeev & Singh, Alka & Pal, Suresh, 2015. "Changing pattern of energy use in Indian agriculture and linkage between energy and commodity prices," 2015 Conference, August 9-14, 2015, Milan, Italy 211805, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:211805
    DOI: 10.22004/ag.econ.211805
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    References listed on IDEAS

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    1. Jha, Girish Kumar & Pal, Suresh & Singh, Alka, 2012. "Changing Energy-use Pattern and the Demand Projection for Indian Agriculture," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 25(1), June.
    2. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    3. Rosa, Franco & Vasciaveo, Michela, 2012. "Agri-Commodity Price Dynamics: The Relationship Between Oil and Agricultural Market," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126738, International Association of Agricultural Economists.
    4. Campiche, Jody L. & Bryant, Henry L. & Richardson, James W. & Outlaw, Joe L., 2007. "Examining the Evolving Correspondence Between Petroleum Prices and Agricultural Commodity Prices," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon 9881, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Yu, Tun-Hsiang (Edward) & Bessler, David A. & Fuller, Stephen W., 2006. "Cointegration and Causality Analysis of World Vegetable Oil and Crude Oil Prices," 2006 Annual meeting, July 23-26, Long Beach, CA 21439, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Jha, Girish Kumar, 2013. "Energy Growth Linkage and Strategy for Meeting the Energy Demand in Indian Agriculture," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 26(Conferenc).
    7. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-1580, November.
    8. Natanelov, Valeri & Alam, Mohammad J. & McKenzie, Andrew M. & Van Huylenbroeck, Guido, 2011. "Is there co-movement of agricultural commodities futures prices and crude oil?," Energy Policy, Elsevier, vol. 39(9), pages 4971-4984, September.
    9. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
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    Cited by:

    1. Dennis Wichelns, 2015. "Achieving Water and Food Security in 2050: Outlook, Policies, and Investments," Agriculture, MDPI, vol. 5(2), pages 1-33, April.

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