A Study on Futures Trading in Commodities With Special Reference to Rubber

Futures trading in Commodities has three specific economic functions viz. price discovery, hedging and reduction in volatility. Natural rubber possesses all the specifications required for futures trading. Commodity futures trading in India attained momentum after the starting of national level commodity exchanges in 2003. The success of futures trading depends upon effective price risk management, price discovery and reduced volatility which in turn depends upon the volume of trading. In the case of rubber futures market, the volume of trading depends upon the extent of participation by market players like growers, dealers, manufacturers, rubber marketing co-operative societies and Rubber Producer’s Societies (RPS). The extent of participation by market players has a direct bearing on their awareness level and their perception about futures trading. In the light of the above facts and the review of literature available on rubber futures market, it is felt that a study on rubber futures market is necessary to fill the research gap, with specific focus on (1) the awareness and perception of rubber futures market participants viz. (i) rubber growers, (ii) dealers, (iii) rubber product manufacturers, (iv) rubber marketing co-operative societies and Rubber Producer’s Societies (RPS) about futures trading and (2) whether the rubber futures market is fulfilling the economic functions of futures market viz. hedging, reduction in volatility and price discovery or not. The study is confined to growers, dealers, rubber goods manufacturers, rubber marketing co-operative societies and RPS in Kerala. In order to achieve the stated objectives, the study utilized secondary data for the period from 2003 to 2013 from different published sources like bulletins, newsletters, circulars from NMCE, Reserve Bank of India (RBI), Warehousing Corporation and traders. The primary data required for this study were collected from rubber growers, rubber dealers, RPS & Rubber Marketing Co-operative Societies and rubber goods manufacturers in Kerala. Data pertaining to the awareness and perception of futures trading, participation in the futures trading, use of spot and futures prices and source of price information by dealers, farmers, manufacturers and cooperative societies also were collected. Statistical tools used for analysis include percentage, standard deviation, Chi-square test, Mann – Whitney U test, Kruskal Wallis test, Augmented Dickey – Fuller test statistic, t- statistic, Granger causality test, F- statistic, Johansen co – integration test, Trace statistic and Max –Eigen statistic. The study found that 71.5 per cent of the total hedges are effective and 28.5 per cent are ineffective for the period under study. It implies that futures market in rubber reduced the impact of price risks by approximately 71.5 per cent. Further, it is observed that, on 54.4 per cent occasions, the futures market exercised a stabilizing effect on the spot market, and on 45.6 per cent occasions futures trading exercised a destabilizing effect on the spot market. It implies that elasticity of expectation of futures market in rubber has a predominant stabilizing effect on spot prices. The market, as a whole, exhibits a bias in favour of long hedges. Spot price volatility of rubber during futures suspension period is more than that of the pre suspension period and post suspension period. There is a bi-directional association-ship or bi-directional causality or pair- wise causality between spot price and futures price of rubber. From the results of the hedging efficiency, spot price volatility, and price discovery, it can be concluded that rubber futures market fulfils all the economic functions expected from a commodity futures market. Thus in India, the future of rubber futures is Bright…!!!

Tailoring Magnetic, Mechanical and Dielectric Properties of Magnetorheological Elastomers based on Natural Rubber and Iron by Magnetic Field Assisted Curing for Possible Applications

If magnetism is universal in nature, magnetic materials are ubiquitous. A life without magnetism is unthinkable and a day without the influence of a magnetic material is unimaginable. They find innumerable applications in the form of many passive and active devices namely, compass, electric motor, generator, microphone, loud speaker, maglev train, magnetic resonance imaging, data recording and reading, hadron collider etc. The list is endless. Such is the influence of magnetism and magnetic materials in ones day to day life. With the advent of nanoscience and nanotechnology, along with the emergence of new areas/fields such as spintronics, multiferroics and magnetic refrigeration, the importance of magnetism is ever increasing and attracting the attention of researchers worldwide. The search for a fluid which exhibits magnetism has been on for quite some time. However nature has not bestowed us with a magnetic fluid and hence it has been the dream of many researchers to synthesize a magnetic fluid which is thought to revolutionize many applications based on magnetism. The discovery of a magnetic fluid by Jacob Rabinow in the year 1952 paved the way for a new branch of Physics/Engineering which later became magnetic fluids. This gave birth to a new class of material called magnetorheological materials. Magnetorheological materials are considered superior to electrorheological materials in that magnetorheology is a contactless operation and often inexpensive.Most of the studies in the past on magnetorheological materials were based on magnetic fluids. Recently the focus has been on the solid state analogue of magnetic fluids which are called Magnetorheological Elastomers (MREs). The very word magnetorheological elastomer implies that the rheological properties of these materials can be altered by the influence of an external applied magnetic field and this process is reversible. If the application of an external magnetic field modifies the viscosity of a magnetic fluid, the effect of external magnetic stimuli on a magnetorheological elastomer is in the modification of its stiffness. They are reversible too. Magnetorheological materials exhibit variable stiffness and find applications in adaptive structures of aerospace, automotive civil and electrical engineering applications. The major advantage of MRE is that the particles are not able to settle with time and hence there is no need of a vessel to hold it. The possibility of hazardous waste leakage is no more with a solid MRE. Moreover, the particles in a solid MRE will not affect the performance and durability of the equipment. Usually MR solids work only in the pre yield region while MR fluids, typically work in the post yield state. The application of an external magnetic field modifies the stiffness constant, shear modulus and loss modulus which are complex quantities. In viscoelastic materials a part of the input energy is stored and released during each cycle and a part is dissipated as heat. The storage modulus G′ represents the capacity of the material to store energy of deformation, which contribute to material stiffness. The loss modulusG′′ represents the ability of the material to dissipate the energy of deformation. Such materials can find applications in the form of adaptive vibration absorbers (ATVAs), stiffness tunable mounts and variable impedance surfaces. MREs are an important material for automobile giants and became the focus of this research for eventual automatic vibration control, sound isolation, brakes, clutches and suspension systems