After the launch of 10g gold futures, dated Brent Crude Oil (Platts) futures contracts, and electricity futures, the exchange now eyes taking the total number of unique offerings to 12 in a move to expand its commodity segment offerings. The launch of these contracts will be rolled out over the next few months, subject to regulatory approvals.
“We are now past the market-deepening phase. The groundwork is done,” said Sriram Krishnan, Chief Business Development Officer at NSE, in an interaction with Business Standard. “This is the phase where we will focus on differentiation.”
These launches, including West Texas Intermediate (WTI) crude oil with different expiry and natural gas contracts, are expected by June 2026.
After an initial foray into commodities between 2017 and 2020 failed to gain traction, the NSE spent the past two-and-a-half years rebuilding the segment from the ground up. It focused first on liquidity and ecosystem participation before turning to product innovation.
NSE’s earlier attempt faltered largely because it offered products already available on rival platforms, providing little incentive for traders to switch.
The exchange has since reworked its approach, starting with high-demand contracts such as crude oil, natural gas, gold and silver, said Krishnan.
A turning point came in October 2023, when the Securities and Exchange Board of India (Sebi) allowed NSE to launch a wider suite of commodity products —including options.
This came amid potential concerns over a technology transition at MCX from erstwhile promoter 63 Moons Technologies Ltd to TCS.
Today, around 280 members are connected to NSE’s commodities segment, with all major retail platforms offering access, added Krishnan.
One of its key strategies has been to tweak contract specifications rather than simply duplicating existing ones, explained Krishnan.
For instance, NSE has introduced a crude oil contract with an expiry a week earlier than MCX’s, giving traders an additional trading window. The move has gained traction, with premium turnover rising sharply in recent months and market share climbing to around a third in some expiries.
A similar approach is being extended to natural gas contracts, with revised expiry timelines set to go live from June.
In bullion, NSE is introducing smaller contracts, targeted at retail investors and jewellers. It has launched a 10-gram (gm) gold futures contract and modified its silver contract size to 100 gm.
The exchange is also betting on low-cost physical delivery as a differentiator. Buyers opting for delivery can receive gold bars at their doorstep with certified purity, paying only the margin upfront and the balance at expiry for a delivery charge of Rs 99 — a fraction of what is charged by rivals.
NSE has introduced a dated Brent crude contract, which better reflects India’s import basket compared to WTI crude.
“This is where NSE’s strength lies — bringing in real users of commodities, not just traders,” Krishnan said.
He said the exchange is engaging with value-chain participants such as oil companies, chemical firms and fertiliser makers to ensure long-term liquidity.
While foreign portfolio investors are currently limited to participating in cash-settled commodity contracts, discussions are underway with Sebi to expand their access.
Krishnan said the exchange is not focused on near-term profitability.
“We are in a build-up phase. As a market infrastructure institution, our role is to develop the market first. Revenue metrics will follow later,” Krishnan said.
 "national stock exchange, NSE, markets")