NMCE floats 1-yr kapas V-797 futures

The National Multi Commodity Exchange (NMCE) of India launched one-year kapas V-797 futures on Monday, said its MD Kailash Gupta.

Currently, the contract available for trading on the exchange platform is May 2009, he said.

“We expect volumes in this contract to start increasing shortly as it is a national contract. This contract will provide national level traders an opportunity to take position in this regional commodity,” Gupta said at a conference here. Surendranagar district is the largest kapas V-797 growing area in Gujarat.

“We don’t intend to compete with the regional commodity exchange (Surendranagar Cotton Exchange). In fact, this contract will help increase the liquidity of kapas contract in the regional exchange. This contract will provide an arbitrage opportunity to the traders,” said Gupta. The exchange would also consider launch of other varieties, such as Bt cotton, in future, he added. 

“After a year we will have another meeting with the ginners, traders and farmers and decide on how to make this contract more liquid and effective,” Gupta said. The margin for kapas V-797 contract will be 5 per cent and the delivery samples will be certified by NMCE approved surveyors.