With the suspension of rubber futures trade affecting its bottom-line, the Ahmedabad based National Multi Commodity Exchange is looking at India specific commodities to shore up its volume. The exchange is looking to open trade in a new coffee variety called ‘Robusta Cherry EP’, which the exchange believes can bring in more participation compared to the Robusta Cherry AB variety which is currently traded in the commodity exchanges.
?We have approached the FMC for sanctions and hope to start the contracts within a month. NMCE is also looking at new point of deliveries in Kushalnagar, Chickamangalur, Hassan and Kalpetta,? Anil Sharma, CEO of NMCE said. Sharma feels that the new variety offers better scope for hedging.
Terming the suspension of futures trading in rubber as unfortunate and unwarranted, NMCE officials said that futures trading in rubber was successful and more inclusive. ?Farmers, particularly in Kerala, were using cooperatives as aggregators to bring in tradable lot and hedge. Banks were also finding financing very attractive with the involvement of big cooperatives,? Sharma said.
He said that the suspension would bring down transparency and put the trade into the clutches of few big traders. ?The suspension has damaged the forward trading with players very apprehensive and afraid to take positions in other commodities. Such moves will cause irreparable damage to the trade,? Sharma said.
NMCE has seen daily trade volume dwindle by 20-25% after the suspension of rubber contracts.
NMCE is planning to bring in more India specific commodities so that price discovery can be made from India and be relevant to foreign importers. It has recently launched contracts in ?isabgol? (natural laxative), jute and menthol crystals.
India is a big exporter of isabgol and the transparent price discovery mechanism offers scope for exporters and farmers to hedge, Sharma added.