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Re-launch of pepper futures likely

Dilip Kumar Jha  |  Mumbai 

futures contracts on commodity exchanges might be re-launched soon when the controversial mineral oil issue is resolved. The issue had rocked the Food Safety Standards Authority of India (FSSAI) and led to sealing of 8,000 tonnes of the commodity in Kochi and suspension of trade in December 2012. The Forward Commission (FMC) had asked the National Commodity & Derivatives Exchange (NCDEX) to resolve the issue before granting permission to re-launch the contracts, temporarily suspended a few months ago. Following this, NCDEX released the payment for testing the samples of sealed by FSSAI, applying for new contracts afresh. As didn't mention mineral oil testing in the contract, it chose to suspend the contract to avoid controversy.

Meanwhile, the mineral oil issue related to the stocks sealed by in Kochi has gradually lost relevance. Used to polish sub-standard pepper, mineral oil evaporates after three months. That is in no hurry to release the sealed is evident from the fact that a random check of two lots (of nine tonnes and 24 tonnes) in February found no trace of mineral oil. The two lots were found deposited by farmers who, according to experts, did not have adequate resources and skill for mineral oil polishing. However, now, has changed the evaluation method. Against random checks earlier, it is now evaluating the stocks through the cleansing method---samples from all packets are taken for testing in an independent laboratory. "We are aware of the fact that absorbs mineral oil and chances are the traces of mineral oil, if any, would evaporate over time. Hence, instead of random checks earlier, we are carrying out the cleansing method of sampling, which would necessarily call for samples from every pack," said Anil Kumar, joint commissioner of FSSAI, Thiruvananthapuram. FSSAI's Kerala unit had, on December 18, sealed about 8,000 tonnes of pepper, worth Rs 300 crore, in various warehouses registered with NCDEX. Experts at the Spices Board have already started issuing the analytical report. "As soon as we get the analytical report from the Spices Board, we would release the quantity," said Kumar. Mineral oil is banned in India, and it isn't used with edible commodities.

First Published: Thu, April 25 2013. 22:15 IST
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