The turnover of commodity exchanges (commexes) in the country fell a sharp 63% in the first fortnight of September to over R3.31 lakh crore, mainly due to imposition of additional margins imposed by the FMC.
According to data released by the Forward Markets Commission (FMC), the turnover of the commexes in the corresponding period last year was over R8.90 lakh crore.
Similarly, the total value of trade also decreased by 22% to R62.29 lakh crore during September 1-15 as against R80.30 lakh crore in the same period last year.
"Volumes of trade have fallen drastically after the imposition of additional margins on base metals and guar seeds. Prior to this, market sentiment was already under pressure after imposition of the commodities transaction tax (CTT),"
Religare Securities Metals Research associate vice-president Sugandha Sachdeva said.
Amid volatility in the markets, commodity market regulator, FMC, had imposed an additional margin of 5% for all base metals contracts and a 10% special margin on long side of all the contracts of guar seeds and gum, in the first week of this month.
Traders and markets experts have also attributed the current fall in the turnover of comexes to the crisis at NSEL, which they believe has shaken the confidence of investors in commodity trading.