The Hindu Business Line : MCX ties up with TOCOM to share products

The President and COO, TOCOM, Mr Takamichi Hamada, and the MCX Managing Director, Mr Jignesh Shah, exchanging documents as the Minister for Agriculture, Consumer Affairs, Food & Public Distribution, Mr Sharad Pawar, looks on at the MoU signing ceremony in Mumbai on Thursday. — Paul Noronha

Mumbai , Nov. 4

THE country should turn a trendsetter in respect to the price or demand and supply in at least 5 major commodities, Mr Sharad Pawar, Union Minister of Agriculture, Consumer Affairs, Food and Public Distribution, said here on Thursday.

At the signing ceremony between the Multi Commodity Exchange of India (MCX) and the Tokyo Commodity Exchange (TOCOM) of Japan held here, Mr Pawar said: "The need of the hour is to position Indian commodities market on global level.

"The country should put in all efforts and take all the necessary steps that can position us on a global scale in these commodities."

However, he did not name those five commodities. But, he said: "India is world's leading producer of 17 commodities, and it is the world's major market for gold, silver, food-grains, edible oils, fibres, spices and plantation crops."

Giving some facts about the Indian gold market, he said: "India is the world's largest consumer of gold.

"The country influences the world demand and prices because of the sheer size of our consumption.

"The country imports around 700 tonnes of gold annually. Around 10,000-15,000 tonnes of gold is stocked in the country.

"Considering the global stock of gold being around 1,45,000 tonnes, the share of gold held in the country is at 7-10 per cent."

He further said along with agriculture, the country should pay equal attention to the global commodities such as gold, silver, crude and exotic products to get the recognition in the global market place and to emerge as a global trading hub between Tokyo and London.

On MCX-TOCOM agreement, he said this would go a long way in taking the country to great heights and would position India firmly on the global commodity map.

"Today's signing ceremony signifies the creation of a new partnership in the Asian derivatives market. I understand India is the fastest growing economic centres in the Asian-Pacific region," Mr Takamichi Hamada, President and COO of the TOCOM, said.

TOCOM is the second largest commodity futures exchange in the world, after the NYMEX of the US.

About volatility in crude oil prices, Mr Hamada said: "I believe TOCOM's West Asia crude oil prices are adequately reflecting the supply and demand situation in Asia.

"Prices are rising, due to the economic growth in China and India, and a shortage of spare capacity of oil supply in the OPEC countries, among other things."

He said: "TOCOM has a very active gold futures market. The project is underway with a futures exchange in Asia-pacific region to collaborate in further developing this important market.

MCX completed its first year of operations and total volume reached at Rs 46,743.10 crore till October 23. The exchange might launch TOCOM fuel oil, gasoline and kerosene contracts soon, Mr Jignesh Shah, Managing Director of the exchange, said.