The Hindu Business Line : Confusion keeps cumin traders away from NMCE

Traders at Unjha, the largest cumin seed market in the country, are yet to get actively involved in futures trading in the commodity at the National Multi-Commodity Exchange (NMCE) due to confusion over quality parameters.

"There are discrepancies in the English and Gujarati version of the draft contract circulated to us. Moreover, the Central Warehousing Corporation (CWC) is yet to take up godown space here," says Mr Pravin Patel, a leading cumin seed trader at Unjha.

The CWC receipt, although not yet covered in the Negotiable Instruments Act, is required by NMCE when the contract matures to ensure delivery. "The day CWC opens its godown here, I will be the first to present my stock of cumin seed. But till the confusion is sorted out, trading on NMCE is unlikely to pick up," says Mr Patel.

The NMCE Managing Director, Mr Kailash Gupta, however, says that the discrepancy is only a translation problem. NMCE launched futures trading in cumin and psyllium husk last Saturday at a special function at the Unjha Agricultural Produce Marketing Yard.

"We have constituted a committee that consists of traders, our officers and CWC representative. All issues will be sorted out by the committee," Mr Gupta said.

Fear of rejection

But traders fear the prospect of having their stocks rejected by the CWC on account of quality.

Apart from the quality of seed in terms of damaged, discoloured or shrivelled seeds, the Gujarati draft contract talks about permitting seeds with stalks up to 10 per cent while the figure is 8 per cent in the English contract.

"This (kind of confusion over quality) had happened with the other two exchanges where futures trading in cumin is already happening. It took some time before the issue was resolved. We want to have a clear understanding of the quality parameters at the outset," another trader at Unjha said.

The CWC Regional Manager, Mr R.N. Meena, told Business Line that the traders' concerns would be suitably addressed.

"We are here to facilitate the trading process. We do not get actively involved in the trading as our role is limited to warehousing and quality assurance. In that regard, we can assure that we will follow the established norms of the trade and not insist on creating new standards of our own," Mr Meena said.

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