National Commodity and Derivatives Exchange Ltd (NCDEX) and Coffee Board are working to develop an electronic spot exchange platform for coffee in the next six months to enable wider participation in the auction of coffee, according to Union minister of state for commerce Jairam Ramesh.
Inaugurating trading in the redesigned coffee contract on the NCDEX on Monday, Ramesh said the futures trading in coffee will be successful only if more than 40% of the total coffee growers or around 80,000 farmers participate either on their own or through co-operatives in futures trading, which should also ensure more than 90% of export value for the produce brought by the small growers. He said that by including coffee, the NCDEX has futures trading in 53 commodities. The exchange and the Coffee Board will educate the coffee growers over futures trading. Awareness programmes have been conducted in Madikare, Chikmagalur and Sakleshpur jointly by the Coffee Board, NCDEX and National Multi-Commodity Exchange (NMCE). Three more programmes have been planned in Sultan Battery in Kerala and Salem and Pattiveernapatti in Tamil Nadu.
Ramesh said that the NCDEX and the Coffee Board have worked out a joint programme for establishing warehouses in the major coffee growing areas in Karnataka, Kelara and Tamil Nadu. Ten such warehouses will be established in a month?s time to provide state-of-the-art facilities .Earlier, NCDEX managing director PH Ravikumar said the exchange is proposing to launch five alternate month contracts with 12-month life cycle from the second cycle onwards. In order to avoid squeezing of the market by a few players, it has incorporated the facility of staggered delivery on the last 10 trading days before the expiry of the contract.