Business Daily from THE HINDU group of publications
Monday, Jan 22, 2007
ePaper
Business Daily from THE HINDU group of publications Monday, Jan 22, 2007 ePaper |
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Agri-Biz & Commodities
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Commodity Exchanges MCX, UPASI plan tie-up for tea spot, futures trading Pratim Ranjan Bose
The proposal MCX will manage spot and futures trading on tea contracts promoted by UPASI The spot trading will be promoted by MCX subsidiary, NSEL The association had also identified four tea varieties two each from orthodox and CTC segment for forward trading
MCX and United Planters' Association of Southern India (UPASI) are planning a collaboration for launching spot as well as futures contracts in South Indian tea varieties. According to sources, as per the proposal, which is still under discussion, MCX will manage spot and futures trading on tea contracts promoted by UPASI. The spot trading will be promoted by MCX subsidiary, National Spot Exchange Ltd (NSEL). UPASI is the apex body of planters of tea, coffee, rubber, pepper and cardamom in the southern States. The association had received permission from the Forward Markets Commission (FMC) in 2003 for holding futures trade on tea, rubber and spices through UPASI Commodities Exchange.
Four varieties
The association had also identified four tea varieties two each from orthodox and CTC segment for forward trading. The project, however, did not take off primarily due to fund paucity. The sources said that in its latest bid UPASI proposed to launch spot contracts either on the four identified varieties or on all major estates. The latter is more in line with the existing trading principles in the tea sector.
Index-based trading
Since tea qualities are estate as well as season specific within each broad variety, the association has proposed launching of index-based futures trading on tea that is widely followed in some global commodity exchanges. However, UPASI is yet to receive the Government's nod for launching index-based futures trading.
More Stories on : Commodity Exchanges | Tea
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