Futures brighten for banned commodities

MUMBAI: Futures trading in four commodities ��� soya oil, potato, rubber and chickpeas (chana) ��� is likely to resume this week after more than six months.

The trading suspension order on these commodities lapsed on November 30.
The exchanges are awaiting the regulatory go-ahead to launch new contracts in these commodities and have submitted their proposals to Forward Markets Commission, the commodity market regulator.

Inflationary concerns led the government to ban futures trading in these commodities in May ���08 for four months. This was later extended up to November 30. Inflation has now eased to 8.84% from a 16-year high of 12.9% in August.

���We had submitted applications to FMC long back and are awaiting approval to trade again in these commodities,��� said Unupom Kausik the chief business officer of the commodity exchange NCDEX.

Soya oil and chick peas (chana) generated good volumes on the exchanges especially NCDEX. On an average, both these commodities were clocking a volume between Rs 700 and Rs 1,000 crore on NCDEX. Rubber was mainly traded on the NMCE platform, while potato was most liquid on MCX.

FMC chairman BC Khatua said that they have received the proposals from the exchanges which are likely to be processed in this week itself. Edible oil traders had also been demanding for long that the government lifts the ban as prices touched their rock bottom levels at the wholesale markets. Refined soya oil prices that reached Rs 65-Rs 70 per kg three months back, fell to Rs 38 in November.

According to the Soybean Processors Association of India (Sopa) co-ordinator Rajesh Agrawal, traders are now buying soya oil. Prices are up, confidence is back and volumes on futures will also increase.

Vibhuratan Dhara of Bonanza Commodity feels that soya oil and chana will immediately trigger volumes on the exchanges. ���I feel that sentiments will also improve in other commodities after trade resumes in these commodities,��� he said.

However, Dilip Bhatia of Kotak Commodity Services said that it will take some time before active trading begins. ���Clients will take some time to come back and start trading in these commodities,��� he said.