The Hindu Business Line : `NCDEX world's third largest agri-exchange'

National Commodity and Derivatives Exchange (NCDEX) has emerged as the world's third largest agricultural exchange. In only its second full year of operation, NCDEX trades a considerably higher volume of agricultural contracts than the New York Board of Trade, the Unctad said in its latest report.

Special mention

Making a special mention of China's Dalian Commodities Exchange and India's NCDEX for their stellar performance, the report said the key factor driving growth in agricultural futures has been the emergence of dynamic markets in China and India.

NCDEX has undergone spectacular rise as a hub for agricultural trade in the subcontinent. Trading that stood at 6.5 million contracts in 2004 increased by 562 per cent (more than six-fold rise) to 43.0 million traded contracts in 2005.

"We are glad our performance is being noted and we look forward to bettering it in future," Mr P.H. Ravikumar, Managing Director of the country's foremost commodity futures exchange, told Business Line.

Growth

Global commodity futures and options trading continued to grow at a healthy pace in 2005, for the second year in a row, outpacing financial futures and options, UNCTAD said in its report, adding that during January-February 2006, such trading was an impressive 41 per cent higher than during same period previous year.

Developing country exchanges, particularly in China and India, can now clearly be recognised as one of the major liquidity centres in world commodity markets with eight of top 15 commodity futures exchanges in 2005 located in Asia.

Looking forward, the coming years are likely to see substantial further growth in emerging commodity markets, the report pointed said, adding that this will be driven by the continued growth of existing exchanges, particularly those in China and India and also by the rise of other exchanges situated in emerging markets.

India's Forward Markets Commission, the regulator of the commodity exchanges, has been hinting that it may grant national status to new entities, which could provide further competition to the existing one, the report remarked.

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