Tuesday, Aug 4, 2020

By Sampad Nandy and Rituparna Ghosh 

NEW DELHI – Within months of launching Agridex and a monsoon index, the National Commodity and Derivatives Exchange Ltd is exploring the introduction of an edible oil index, in line with suggestions by stakeholders, Managing Director Vijay Kumar said. 

Stakeholders have also urged the bourse to launch indices for pulses and grains, he said. 

Agridex, the first tradable index for commodities in India, comprises 10 farm products, including castor seed, mustard, and soy.

"Once we get some level of data and so on, we will possibly apply for approvals. Definitely depends on the market requirements and if the market wants some such products, we will definitely design and provide it," Kumar said. 

As India is a large consumer and a leading importer of edible oil, the exchange sees good prospects of an index in this segment.  

India typically imports around 15 mln tn of edible oils, or about 60% of its total annual edible oil consumption of 26 mln tn, while the rest is sourced from homegrown oilseeds.

Trade in edible oils is very significant and will remain so due to the huge consumption, Kumar said.     

Oilseed and edible oil futures--soybean, refined soyoil, castor seed, and mustard seed--traded on the NCDEX usually have high liquidity. All the four commodities are part of Agridex. In July, these components accounted for nearly half the bourse's monthly turnover of 180.5 bln rupees, data on its website showed.        

Recently, the Multi Commodity Exchange of India had secured the Securities and Exchange Board of India's approval to launch indices for bullion and base metals.  End

Edited by Avishek Dutta

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