The Hindu Business Line : NMCE to launch `ready delivery' contract in pepper, rubber

AHMEDABAD-based National Multi Commodity Exchange of India Ltd (NMCE) will launch `ready delivery contract' trading in rubber and pepper in Kochi on June 7.

The product will be on the lines of the T+2 system in equity markets and NMCE will use its online trading platform for the new offering, Mr S. Sundareshan, Chairman of Forward Markets Commission (FMC), said on Friday.

"By evening, all outstanding positions have to be settled by actual deliveries and not by price fixation," Mr Sundareshan said.

NMCE announced in April that it would launch the ready delivery contract system for rubber, pepper and cardamom. With the required clearances from FMC in place, trading will begin in rubber and pepper.

Pointing out that the 24 commodity exchanges in the country logged business to the tune of Rs 5.71 lakh crore in 2004-05, the first full year of operation of the commodity futures markets in the country, Mr Sundareshan said he expected the growth to continue at a brisk pace.

As many as 90 commodities have been approved for trading by FMC at different exchanges and nearly 80 are actively traded.

Requests continue for more commodities such as coal and ethanol, he said, adding that the commission has sought views from the ministries concerned.

Ahead of being given the status of an autonomous institution, on the lines of the Securities and Exchange Board of India, FMC has started sprucing up its monitoring systems to identify and correct any glitches.

"We are in the process of adding 39 new officers. Our monitoring systems have been made more stringent, and every morning we get reports from all exchanges. We also generate commodity-wise reports to identify suspicious deals and check unnecessary liquidity by stepping up margins when required," Mr Sundareshan said.

Asked by when the necessary amendments to the Forward Contracts Regulation Act would be made, he said the draft was ready and had been put up before the Union Cabinet before being tabled in Parliament.

At the same time, the commission was regularly watching price movements in commodities such as gram, guar, wheat and sugar, he said.

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