Cross-border linkages between the global rubber spot and futures markets

• Abhaya Kumar KEPULAJE ^[3] ; Pinto PRAKASH ^[4] ; Ramona BIRAU ^[5] ; Iqbal Thonse HAWALDAR ^[1] ; TAN, Yong ^[2] ; WANKE, Peter ^[2]
  1. [1] Kingdom University

     Kingdom University

     Baréin

     
  2. [2] University of Bradford

     University of Bradford

     Reino Unido

     
  3. [3] Institute of Technology & Management, Udupi, India
  4. [4] St. Joseph Engineering College, Vamanjoor, Mangalore, India
  5. [5] University Constantin Brancusi, Tg-Jiu, Romania

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• Localización: Estudios Economicos Regionales y Sectoriales : EERS: Regional and sectoral economic studies : RSES, ISSN 1578-4460, Vol. 24, Nº. 2, 2024, págs. 159-174
• Idioma: inglés
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• Resumen

  • This paper investigates the linkage between the spot and futures markets of rubber globally. The daily spot price data of rubber in India, Malaysia and Thailand from 4th January 2016 to 2nd November 2022 have been collected from the website of the Association of Natural Rubber Producing Countries (ANRPC); for the same period, the rubber future daily price has been collected from the website of investing.com. The correlation, the Granger causality test, the Johansen cointegration test and the Vector error correction models (VECM) have been applied to test the linkages. The results of the Granger causality and the correlation coefficients revealed the causality between global spot and futures markets for rubber. Johansen's cointegration results justify using VECM; the error correction terms revealed that the correction to the long-term equilibrium would be adjusted in the spot price series. The price of SRU and STF rubber futures traded at Singapore Exchange (SGX) lead the spot price of rubber in India, Malaysia, and Thailand. The study outcomes would help the stakeholders of the rubber industry globally.

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