In a bid to expand the agri futures market, the National Commodities and Derivatives Exchange (NCDEX) plans to bring a system where the farmers would be in a position to alter their cropping pattern based on the futures prices disseminated by the exchange, rather than the practice of sowing a particular crop based on current prices.
?At present, the farmers hedge is based on the existing prices of a particular commodity. By migrating the farmers to cropping patterns based on futures prices they can realise by hedging on exchange platform. This will help in boosting the Indian agri futures market,? R Ramaseshan, managing director & CEO said.
The country contributes almost 25% of the total world agricultural production, however, the total agri commodities futures market stands at mere 2-3% of the global market. , he added.
?Though the agri futures market is small in India compared to the global futures market, there is lot of scope for improvement. To compete with the international players on various futures market the country need to start at the grass root level,? Vijay Kumar, chief business officer, NCDEX said here.
?At present the farmers participation is very low. However, more farmers are being allowed to hedge on futures which is essential for their benefit,? he said. But first, the farmers need to be educated on the pattern of selling their commodities, he added.
