The Hindu Business Line : MCX, Upasi tie up for tea futures

MULTI Commodity Exchange of India Ltd (MCX) and United Planters' Association of Southern India (Upasi) have formally announced a tie-up to develop and set up a tea futures.

With this, the two organisations have brought to an end the uncertainty prevailing in the markets on the probable online futures exchange with which Upasi will be associating for tea futures, according to an exchange release.

Upasi Commodities Exchange Ltd (UCEL), a company promoted by Upasi and MCX, will work together to design the specifications of tea futures contract, work on setting up best practices and procedures for settlement and delivery.

This would be the first tea futures exchange in the world. "There is widespread enthusiasm in the tea industry. Market participants realise the necessity of futures market for ensuring price stability and act as a price hedging mechanism," said Mr. N. Dharmaraj, Chairman, UCEL, in a statement.

MCX futures contracts in tea would facilitate a transparent, robust, scientific and true price discovery platform that will be utilised by the market participants to hedge their risk, according Mr Jignesh Shah, Managing Director, MCX.

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