The Seen and the Unseen - hosted by Amit Varma Ep. 12: Futures Markets in Agriculture
15 snips
Apr 3, 2017 AI Snips
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Episode notes
Futures Markets Benefit Farmers
- Futures markets are pro-farmer, not anti-farmer, as they are a key risk management tool.
- They help farmers manage price risk by allowing them to lock in future prices, reducing uncertainty.
Sugar Futures Ban Example
- In August 2016, the Indian government recommended banning sugar futures due to rising prices.
- They believed speculators were driving up prices, but futures prices reflect actual future demand and supply.
Information Exchange in Futures Markets
- Futures markets facilitate information exchange among farmers, helping them coordinate crop choices.
- By observing futures prices, farmers can see what others are growing and adjust their plans accordingly.