National Stock Exchange to launch first agricultural commodity futures contract

TAD NewsDesk, New Delhi: The National Stock Exchange said in a statement that it will soon launch its first agricultural commodity features contract. This would be for crude degummed soyabean oil. The launch would take place on the 1^st of December.

The statement also added that it will facilitate the processing of soybean oils and the allied industries in India and overseas. This would act as a tool for managing the prices as a negotiation bet between the companies.

The contract would be based on monthly expiry cash. It would include a future contract which would include a trading size of 10 metric ton (MT) and price basis as Kandla.

The exchange aims to further the Indian commodity markets and for it the offer is to provide convenient and cost effective onshore products, said Vikram Limaye, MD and CEO of NSE.

He added, “India being one of the largest consumers of edible oils in the world, requires an efficient hedging mechanism for crude soybean oil as well. This product will work as a perfect price risk management tool for the market participants and the commodity ecosystem at large.”

B V Mehta, THe Solvent Extractors Association of India (SEA) said highlighted the benefits of contracts that made price management risk and easy for the whole industry.

He also added,

“More such futures contracts should be launched going ahead so that we can have a vibrant commodity markets ecosystem in India.”

And hence this launch bears signifance in the undercurrent of the exchange market.

Source: Deccan Herald