Structural Change Analysis of Groundnut Export Markets of India: Markov Chain Approach




Background/Objectives: Groundnut or Peanut (Arachis hypogea) is the major
oilseed of India. Groundnuts are essential protein crops in India and grown
mostly under rain-fed conditions. India occupies first in terms of area and
second position in terms of production. China is the largest producer as well
as consumer of groundnut in the world with 166.24 lakh tonnes followed by
India 68.57 lakh tonnes. India exports groundnut to more than 75 countries.
The country has exported 6,64,436.00 MT of groundnuts to the world for the
worth of |5,096.39 crores during the year 2019-20. This study is to analyze
the structural change in the export of groundnut from India to different major
import markets by using the Markov chain model. Methodology: Secondary
data on groundnut yearly export data from India to other countries, were
collected from 2009-10 to 2019-20. Markov chain analysis were used to obtain
the results. Findings: The results have shown ‘other countries’ category,
Malaysia, and Russia as stable destination for Indian groundnut exports.
Other traditional importing countries such as Indonesia and Thailand countries
are unstable (low retention probabilities) export share to these markets.
Philippines, Socialist Republic of Vietnam, Ukraine, and United Arab Emirates
are the most unstable markets among importing countries. Predicted export
shares of groundnut to major importing countries revealed that the export
share of Indian groundnut is predicted next four years in that highest to
Indonesia as 33.18 per cent and lowest to United Arab Emirates as 1.35 per
cent. Novelty: The study highlights the opportunity to invest in global trade of
groundnut for the stakeholders involved in groundnut trade.