NCDEX seeks nod for sugar futures trading

The National Commodity and Derivatives Exchange (NCDEX) today said it is planning to raise around Rs 12.50 crore to meet the government’s minimum capital norm of Rs 50 crore, needed for the stipulation for rights issue. Meanwhile the exchange said it has sought permission to trade sugar.

NCDEX offers futures trading in 47 commodities in agriculture, energy, metals, plastics and carbon credits.

Speaking to reporters in Chennai today NCDEX’s Managing Director and Chief Executive Officer R Ramaseshan said the exchange has met the government’s guidelines of networth of Rs 100 crore. “We have completed the first round of rights issue, raising Rs 37.50 crore and are in the process of raising the balance amount.

Meanwhile, as the ban on futures trading in sugar expired, the exchange has applied for permission with the Forwards Market Commission for renewing trading.

“Commodity futures market has been growing impressively and this is evident from the fact that the total traded value in metals (other than bullion) has grown 72 per cent, while the trade in energy has grown 25 per cent. With the April-July IIP figures showing a 38 per cent rise in capital goods sector, demand for steel will only grow in the coming year, said Ramaseshan.”

Meanwhile, NCDEX said its current average daily trading volume (ADTV) was more than Rs 3,000 crore so far. In the last two months it has been close to Rs 4,000 crore, said Vijay Kumar, chief business officer, NCDEX. He said the total traded value so far was over Rs 5 lakh crore compared to Rs 3.87 lakh crore last year.

Other than agricultural commodities, the increase in ADTV has been due to steel and crude oil contracts. Guargum, guarseed and oilseeds, in which NCDEX leads the market share, has also been growing since the last few years, he said.