Agricultural Economics Research Review

This paper has attempted to find whether major sorghum (rabi) markets in Maharashtra are integrated using monthly wholesale price (modal) data of sorghum (rabi) from January 2005 to December, 2014. The major APMC markets selected for the study were: Solapur, Pune, Ahemadnagar, Osmanabad, Beed, Jalna, Aurangabad and Parbhani. Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) test have been applied to check stationary of price data. Integration among the markets has been tested by estimating bivariate correlation coefficient and multivariate cointegration method using SAS 9.3 software. The results have revealed that all the sorghum price series are non-stationary at level and become stationary after first differentiation. All the sorghum markets under study are co-integrated and converge to long-run equilibrium. The pair-wise co-integration results have indicated that all the sorghum markets having long-run equilibrium, except the Pune-Solapur market. Homogenous product (mostly of Maldandi variety), better marketing infrastructure, specially transportation, and strong linkages among the intermediaries have been identified as the probable reasons for market integration.