SEBI mulls lifting decade-old ban on tur, urad futures

The Securities and Exchange Board of India (SEBI) may soon allow futures trading in tur and urad dal as the regulator considers lifting a decade-old ban.

The Ministry of Finance has also given its nod, according to sources.

“The Ministry of Agriculture is not convinced with relaunching of trading in pulses. However, the Ministry of Finance has told them that tur and urad are notified commodities which was approved after their nod,” a source close to the development told Moneycontrol.

FinMin had earlier notified 91 commodities, including tur and urad, on which exchanges can launch commodity for trading after SEBI’s nod.

Agri-commodities bourse NCDEX has also sought the regulator’s nod for relaunching futures trading in tur and urad. Trading in tur and urad was banned in 2007 after a spike in prices of these commodities Currently, these commodities have been trading below the minimum support price (MSP), which is a cause of concern for the government.

Market experts are also in favor of the ban being revoked.

“If SEBI allows future trading in tur and urad, it may ease cartelisation in pulses. Large players will also show interest and derivative is a good tool for price discovery,” said Vijay Sardana, member of SEBI’s committee commodity derivative advisory committee.

Atul Chaturvedi, former Chief Executive Officer, of Adani Wilmar, also echoed his sentiments.

“There is need of future trading in pulses for proper price discovery and currently these commodities are in price pressure,” he said.

Although SEBI is looking to increase the basket of agri-segment products, new exchanges are focusing more on the non-agri segment.