Assessing The Effects Of Climate Change On Mcx Agricultural Commodity Prices In India

Abstract

Global warming has become one of the important factors of productivity and market security in the agricultural sector especially in economic agricultural countries such as India. This paper attempts to determine the effect which a varying climate has on agricultural commodity prices at the Multi Commodity Exchange (MCX) of India. Through its attention to major commodities, including cotton, soybean and mentha oil, the research study attempts to examine the interplay between climate factors i.e. the rise and fall in temperatures, unreliability in rainfall patterns, and the occurrence of extreme weather conditions and two price fluctuations in the short-term and medium- term lapses. The study relies on time-series econometric analysis, such as multiple regression analysis, by utilizing secondary data of the Indian Meteorological Department (IMD) and MCX trading statistics of the years 2010 - 2023 and discovers important connection between climate anomalies and commodity pricing. The results show that the direct impact of climate-created supply disturbance on the price bursts leads to the general instability of the markets, making it a problematic situation to those farmers, traders, and even policymakers. It is an important study of India with respect to its commodity markets that indicates a future requirement of climate-resilient approaches to the agricultural trade and agriculture policy to protect the relevant stakeholders against emerging environmental risks.