The National Commodity and Derivatives Exchange Ltd, on Thursday, officially launched its Gold 100 gms contract with Hyderabad as the main delivery Centre and Chennai as an additional centre.
This is for the first time that the exchange is offering a Futures contract in gold with focus on South India, which accounts for nearly 45 per cent of the country’s demand for the yellow metal
The cardinal objective of this initiative is to facilitate deliveries of the metal at cities within the main consuming region, covering the four States in the south.
"We will be adding new delivery centres as trading picks up. We chose Hyderabad as the Basis (delivery) centre for the contract, as south India accounted for almost 60 per cent of the import of Gold 100," Vijay Kumar, NCDEX Chief Business Officer, told media persons here.
New non-agri commodities
The exchange plans to add other new non-agri commodities in its portfolio. Apart from gold, it has steel in this segment.
"We have seen an increase in trading in steel contracts of late, with deliveries even reaching up to 30,000 to 40,000 tonnes, due to increased demand from secondary steel producers," Kumar said.
Going backward from steel, NCDEX is now looking at adding scrap and hot rolled coil steel in its portfolio. "The other non-agri commodities we are looking at are furnace oil and PVC (polyvinyl chloride), which is used by the plastics industry," he said.
NCDEX, which is in the process of modernising and electronically linking all the 54 mandis (farm market yards) in Karnataka, has been approached by other State Governments, including Andhra Pradesh and Maharashtra, to take up similar projects on a pilot basis.
The exchange is scheduled to complete the modernisation project in Karnataka within a year, after which all the mandis will be web-linked and farmers will thus have access to markets across the country. The project includes shift from manual to e-tendering, covering 15 commodities, including oil seed, pulses and mangoes.
"We are hopeful that at least two to three states will approach us with proposals to implement the project as a pilot in 2013," Kumar said.