Title: Price risk management in agri-plantation commodities: case study of a farmer producer organisation

Authors: A.N. Vijayakumar

Addresses: Department of Finance & Accounting, Indian Institute of Plantation Management, Bengaluru, India

Abstract: Agri-plantation commodities are prone to price uncertainties and pose risk to value chain participants in managing their affairs in a sustainable manner. Indian agri-plantation sector consists significantly of small and marginal farmers with fragmented landholdings facing challenges in access to agri-inputs, finance, good agricultural practices, market information, technical-know how etc. including price risk. In this regard, the Government of India has been implementing several measures for economic empowerment and to strengthen collective bargaining power through formation of farmer producer organisations. This descriptive case study focusing on agri-plantation commodity explored price risk management practices of a cardamom farmer producer organisation of Kerala and their challenges in mitigating price risk. This study finds non-usage of financial services instruments of derivatives such as Commodity Futures contracts by FPOs due to lack of awareness and poor knowledge in hedging.

Keywords: agri-plantation; commodities; commodity derivatives; farmer producer organisation; price risk management.

DOI: 10.1504/IJFSM.2021.120361

International Journal of Financial Services Management, 2021 Vol.11 No.2, pp.149 - 162

Received: 21 Sep 2020
Accepted: 21 Sep 2021
Published online: 17 Jan 2022 *

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