Financial Daily from THE HINDU group of publications
Thursday, May 06, 2004
Agri-Biz & Commodities
NCDEX to launch sugar, wheat futures in 3 weeks
Kochi , May 5
THE National Commodity and Derivative Exchange Ltd (NCDEX), as part of widening its canvas in the commodities trading, has initiated steps to start futures in several other commodities.
It has been decided to start futures trading in sugar and wheat within three weeks, and the exchange is working on to commence trading in silk, tea, skimmed milk powder, energy, metals and paddy within a short period, said Mr Narendra Gupta, Chief Business Officer of NCDEX.
The exchange is discussing with Power Trading Corporation and NTPC with regard to the beginning of futures trading in power, he added.
Mr Gupta, who was here for the official launch of NCDEX's contracts in pepper and rubber, said the futures contracts in these commodities would add depth to the fast expanding commodity markets and provide a platform for a variety of participants, including growers, users, traders and investors.
He said NCDEX had launched a method of holding of commodities in demat form. Right now, only gold and silver were held in this form. This would be extended to other commodities, he added.
With the inclusion of rubber and pepper, the total number of commodities that are trading on NCDEX had gone up to 15 and the daily volume runs over Rs 100 crore. He pointed out that the volume would equal the equity market in the next two to three years.
The exchange is also in the process of opening more delivery centres against the present 125. It has over 1,000 users with over 500 VSAT connections and lease lines that provide a transparent and efficient trading platform. NCDEX was the first exchange to start trading in pulses and channa (gram), Mr Gupta added.
Speaking on the occasion, Mr S.M. Desalphine, Chairman, Rubber Board, said tyre manufacturers had not shown interest in rubber futures till now. It was mostly dealers who were participating in futures, and now growers were also increasingly participating.
Mr Sanjay Mariwala, Managing Director, Kancour Flavours Ltd, suggested that NCDEX should allow mutual funds and FIIs to participate in the futures. He said options should also be started with futures.
According to Dr K.N. Raghavan, Managing Director, Rubbermark, more grades should be brought under futures trading. He called for discarding the present visual grading of rubber in warehouses and NCDEX should start more collection centres in the country for delivery.
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