NCDEX Spot Exchange Ltd (NSPOT), a leading exchange for daily electronic trading of agricultural commodities, has proposed the Odisha government to provide online trading facility in select mandis for agricultural commodities.
“We have discussed with the Chief Secretary about providing technical support for introducing online trading facility in key mandis. As per the request of the Odisha government, we will send a concept paper within three weeks,” said Samir Shah, managing director and chief executive officer (CEO) of NCDEX, the parent company of NSPOT.
The proposal includes identifying key mandis for maize (corn), turmeric, ginger, cotton, groundnut and sunflower trading in Odisha and to educate both farmers and traders to use online trading platform for transactions. NSPOT has plans to partner with the state government to provide the required facilities.
“We are already doing pilot mandi projects in states like Andhra Pradesh, Telangana and Tamil Nadu. We hope in Odisha we will soon start a pilot project in one of the mandis to study the modifications we need for introducing such concept,” he said.
The NSPOT has identified Umerkote market for starting the pilot trading facility in maize. Umerkote is the main maize producing region of Odisha. The spot exchange provides the farmers across the country the option to sell their produce to a trader based at any place using its facility. However, in the mandi modernisation plan of NSPOT, the farmers of a particular state can only sell to local traders using the online trading platform customised for the state.
“The facility will educate farmers about the real price of their products and will create the necessity for constructing post-harvest farm infrastructure such as warehouses,” said Shah. The state currently has storage capacity of 1.3 million tonne including facilities owned by private players and has plans to add another 200,000 tonnes capacity in near future.
It has agreed to give guarantee for a loan of Rs 40 crore to be availed by the Odisha State Warehousing Corporation (OSWC) for construction of 1.12 lakh-tonne capacity godowns for storage of food grains. The OSWC at present has storage capacity of four lakh tonnes.
Besides, the state government has accepted a proposal of the International Finance Corporation (IFC) for putting in place a warehousing scheme in public private partnership mode. The use of modern facility and technology for agricultural produce trading in local markets will encourage farmers and traders to migrate to futures trading facility offered by NCDEX, the exchange official said. “By engaging with various state governments across India for introducing such concepts, we hope to increase our member base by 12,000 to 18,000 by the end of this fiscal for NCDEX and NSPOT.” Shah said.