NSE To Launch First Agricultural Commodity Futures Contract Next Month
The National Stock Exchange Ltd. building in Mumbai (Photographer: Vishal Patel/BloombergQuint)

NSE To Launch First Agricultural Commodity Futures Contract Next Month


Leading bourse National Stock Exchange Ltd. on Monday said it will launch its first agricultural commodity futures contract for crude degummed soybean oil on Dec. 1.

The contract will facilitate the soybean oils processing and allied industries in India and overseas, a perfect hedging tool for managing their price, the NSE said in a statement.

The contract is a monthly expiry cash-settled futures contract with a trading lot size of 10 metric tonne and price basis as Kandla.

Vikram Limaye, managing director and chief executive of NSE, said the exchange is dedicated to deepen the Indian commodity markets by providing convenient and cost-effective onshore hedging products.

"India being one of the largest consumers of edible oils in the world, requires an efficient hedging mechanism for crude soybean oil as well. This product will work as a perfect price risk management tool for the market participants and the commodity ecosystem at large," he added.

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The Solvent Extractors' Association of India Executive Director BV Mehta said the exchange-traded derivatives contracts are a very useful tool that make price risk management convenient and easy for the industry.

"More such futures contracts should be launched going ahead so that we can have a vibrant commodity markets ecosystem in India," he added.

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