Within 1 month of launch, BSE's commodity segment turnover hits Rs 5.75 bn

Within a month of commencement, the BSE has achieved a landmark of Rs 5.78 billion worth of turnover from its commodity segment. 

Achieved on October 23, the BSE recorded a traded volume of 1,623 lots in gold and silver contracts valued at Rs 5.22 billion. The silver contracts clocked a traded volume of 488 lots with a value of Rs 570 million on October 23.    

The BSE forayed into commodity futures trading on October 1, 2018, over a year after the markets regulator, the Securities and Exchange Board of India (Sebi), approved the launch of commodity derivatives on equity exchanges and vice-a-versa. 

The leading exchange began trading in commodity derivatives on October 1, 2018, after gaining Sebi's approval to launch a delivery-based futures contract in gold (1 kg) and silver (30 kg).  

"BSE's announcement to waive transaction charges has attracted a lot of participants, including all types of brokers and traders, who are cost sensitive due to their nature of business. Out of the 442 expressions of interest received from members, BSE has registered 170 trading members and 27 clearing members in the commodity derivatives segment. Many more members are expected to join the bourse in the near future," BSE said in a statement.

With this, BSE has become the second largest commodities exchange in India. Recently, the bourse had received Sebi's approval to launch Oman Crude Oil contract on the exchange. Several members of BSE have also initiated algorithm trading in this segment, with a few of them already having received the approval and started trading.   

The leading bourse has plans to introduce base metal contracts and agri commodities in the near future, for which it has collaborated with several associations. BSE has entered into a licensing agreement with the London Metal Exchange, a premier base metals-focused commodities exchange. 

It has also associated with Bombay Metal Exchange for base metal contracts and with the Rajkot Commodity Exchange, Federation of Indian Spice Stakeholders, Soybean Processors Association of India and Cotton Association of India to launch agri commodities. Further, BSE envisages launching many commodities out of the 90+ commodities approved by Sebi.

While the National Stock Exchange (NSE) had also entered the commodity derivatives segment on October 12, its volume of business remained lacklustre at around Rs 300 million from both gold and silver contracts. NSE has also received Sebi approval to launch more commodities futures, including copper (30 kg) contracts.