Futures trade in urad, tur banned

New Delhi, Jan 23 | Updated: Jan 24 2007, 06:27am hrs
A day after the finance ministry cut customs duty on cement and other products to check inflation, commodities market regulator Forward Markets Commission imposed a temporary ban on two essential commodities, urad and tur, from futures trading.

Delisting these two commodities for trade on all exchanges, the FMC directive asked traders to square off all their positions at Tuesdays closing price. Traders have been told not to trade in these two commodities without the permission of the FMC.

The rising prices of essential commodities have been an issue of major concern within various sections in the government. The government allowed free import of pulses against zero duty, but even this failed to ease the situation with inflation climbing to 6.12% for the week ended January 6.

When inflation breached the 6% mark, the finance ministry said among food items, urad, tea, tomatoes, coconut and arhar were a matter for concern. A statement said the ministry was in touch with the agriculture ministry on how to control the rising prices of these commodities.

Pulse Of Inflation

Finmin has been in touch with the agriculture ministry over the rising prices of urad, tea, tomatoes, coconut and arhar
The FMC move is likely to have a sobering affect on the prices of all other agri commodities impacting inflation

The open interest position of tur to date was Rs 151 crore and that of urad was Rs 104 crore on the National Commodity & Derivatives Exchange Ltd, the largest bourse for futures trading in pulses. NCDEX chief Narendra Gupta confirmed to FE the FMC directive.

The tur desi futures for Feb 7 on NCDEX was Rs 2,280 per 10 tonne, for March 7 Rs 2,471, for April 7 Rs 2,520 and for May 7 Rs 2,565. The desi urad futures quoted on NCDEX for Feb 7 was Rs 3, 248 per 10 tonne, for March 7 Rs 3,160, for April 7 Rs 3,010 and for May 7 Rs 2,940.

The Tuesday spot prices for tur desi was Rs 2,337.20 and for urad Rs 3,100-3,359.40.