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Capital market regulator SEBI is closely watching entities that have been charged with hoarding of pulses by various State governments.
Outlining SEBI’s stance, UK Sinha, Chairman of the market watchdog, said, “We are in close contact with the Centre. We are watching the situation with the exchanges very closely. I will give you an idea. Respective State governments have seized some stocks. SEBI is looking into the matter that those who have violated the Essential Commodities Act or the control orders connected to the commodity market. If perhaps they are, then there is a case for Sebi to take action against them. We are closely looking into these details and keeping a watch on the situation.”
On the issue of prices of pulses skyrocketing due to speculative trades in the commodities markets, Sinha said “There are no contracts for pulses today. The only relevant contract is chana. And in the chana contract if we look at it very closely, the next month’s futures market is showing backwardation, which means the futures price is lower than the spot price today. So to imagine that the futures price of today is perhaps leading to speculation or rise in prices is on the basis of facts, wrong. Backwardation indicates that those who are hedging in the market, those who are even speculating in the market, they have taken a call, they have put their money on a call that prices are going to fall next month.”
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