NCDEX expects 20% jump in futures trade in FY13

Country's second largest commodity exchange NCDEX expects its turnover to increase by 20% to Rs 22 lakh crore this fiscal on the back of recently launched contracts in products such as barley and sugar.

According to the official data, the exchange had made a business of Rs 18,10,198 crore in 2011-12.

"The total turnover of the exchange should touch about Rs 22 lakh crore this fiscal, 20% higher than last year," NCDEX Chief Business Officer Vijay Kumar told PTI.

The exchange's turnover has already reached Rs 4,02,931 crore in the April-June period of this fiscal, against Rs 3,48,936 crore in the year-ago, as per the official data.

Much of the turnover is being generated from new products like barley, maize, sugar, cotton seed besides traditional commodities such as soyabean, soy oil and mustard, Kumar said.

"There is a potential to generate an additional daily turnover of Rs 2,000 crore if guar futures were reopened in the coming days," he said. Guar futures were banned in March to curb price rise.

Asked if higher margins and threat of ban on some commodities affected the business, Kumar said, "Yes, the market sentiments get affected."

The recent increase of up to 40% in deposit money (margin) on some commodities like oilseeds and potato has restricted hedgers, who are finding it costlier to hedge their risk, he said.

He suggested that hedgers should be exempted from higher margins.

To check price rise in view of likely fall in kharif crop production following weak monsoon, the regulator Forward Markets Commission (FMC) has taken several steps including hike in margins to restrict trade.

The FMC is keeping a close watch especially on agri-futures and has also hinted at banning those commodities showing unusual price fluctuation.