The Hindu Business Line : NCDEX, NCMSL, Markfed ink pact

PUNJAB State Co-operative Supply and Marketing Federation (Markfed), NCMSL and NCDEX have signed a memorandum of understanding (MoU) to offer the benefits of futures trading to the primary producers, including farmers in the hinterland covered by Markfed.

One of the key aims of the MoU is to enablefarmers benefit from prevailing spot and futures prices so that they can sell on a platform which gives the optimum return for their produce.

The alliance aims to work tofer commodity derivatives instruments such as futures.

Punjab federation aims to procure produce through NCDEX platforms (physical deliveries) in agriculture commodities.

In case the farmers and their representative cooperative entities plan to hold the produce for better realisation, NCMSL will work with them to bring banks for funding their intermediate liquidity requirements at lower rates of interest

Under this arrangement, instead of selling their produce at one go on the spot markets, the farmers have a choice to deposit the same quantity in a warehouse operated by federation and accredited by NCMSL. The farmers/the cooperative then will simultaneously sell his produce through a futures contract and has the option of selling the produce at a higher price.

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