Commodity bourse, National Commodity and Derivatives Exchange Ltd (NCDEX) stated that its newly launched degummed soy oil (DSO) futures contract received encouraging response from the market participants on its debut.

On Monday, the July futures contract of DSO registered a volume of about Rs 6 crore, with price hovering in the range of Rs 584.2 to RS 589.55 per 10 kg. Initially two contracts - July futures and August futures were traded on the exchange, while the exchange has announced Degummed Soy Oil contract (Symbol: SYODEGUM, Basis: Kandla) with expiry in the months of July, August, September, October, November, December 2017 and January 2018 from June 12, 2017.

DSO futures will help provide a reference for imported soy oil. The introduction of the contract completes the oilseeds product basket for the exchange and is seen giving the value chain participants an effective tool to manage their price risk and get transparent and relevant price signals.

India, being the fifth largest Soybean producer and largest importer of soy oil in the world, the availability of a national price benchmark will help the entire Soy value chain. Given the high volatility in international edible oil prices, domestic participants are exposed to vulnerability of margins, the introduction of degummed soy oil futures ensures that the soy trade has a more complete hedging solution.

Samir Shah, Managing Director and CEO, NCDEX, said, "The addition of Degummed Soy oil contract to the product basket is aimed at offering an exhaustive and wholesome risk management offering to the market. We are encouraged by the continued support of the industry and look forward to the successful launch of the contract."

Degummed Soy oil is an intention matching contract with a transaction charge of Rs. 0.10 per lakh of trade and no risk management fee. It is included in the “List C” of the commodities.

Published on June 12, 2017