The Hindu Business Line : NCDEX relaunches coffee futures contract

All again: Mr Jairam Ramesh (left), Union Minister of State for Commerce, and Mr G.V. Krishna Rau, Chairman, Coffee Board, at the inauguration of the re-designed coffee futures contract in Bangalore on Monday. –

Our Bureau

Bangalore, Sept. 10 National Commodity and Derivatives Exchange Ltd (NCDEX) re-launched futures contract in the robusta cherry AB coffee variety on Monday.

Launching the contract, the Union Minister of State for Commerce, Mr Jairam Ramesh, said: “The re-launched contract by NCDEX would prove to be a success if it is able to attract about 40 per cent of the coffee growers”.

Further, NCDEX in collaboration with the Coffee Board was working towards developing an electronic spot trading exchange, which would enable wider participation of coffee growers, Mr Ramesh said.

The electronic auction platform is expected to be launched over the next six months.

The electronic auction system for tea, which is being developed by NSE-IT, the IT outfit of National Stock Exchange, would be launched in the next six to seven months, he added.

Mr P.H. Ravikumar, Managing Director and CEO of NCDEX, said the re-launch of coffee futures contract was based on the feedback from stakeholders, including the Coffee Board.

“By launching the redesigned coffee futures contract, we aim to provide an organised electronic marketplace for hedgers like growers, processors, exporters and merchants, and also the investors for effective price discovery,” he said.

Delivery centres

NCDEX has set up four delivery centres for the coffee contract at Kushalnagar, Hassan, Chikmagalur and Kalpetta and expects to set up another six centres in the next few months.

The unit of trading as well as the delivery unit of the re-worked contract is two tonnes and the commodity is deliverable in new jute bags containing net coffee of 60 kg.

The Chairman of the Coffee Board, Mr G.V. Krishna Rau, said the significance of coffee in the country’s economy is underscored by the fact that in Coffee Year 2005-06 (October 2005 to September 2006), India exported coffee worth $411.39 million.

“In the 2006-07 Coffee Year so far (October 2006 to August 2007), India’s cumulative coffee exports amounted to $408.81 million,” Mr Rau said.

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