NCDEX gets approval for launching cotton seed contracts

MUMBAI: NCDEX has received approval for cotton seed contract from the Forward Markets Commission ( FMC) and will be introducing the contracts on the exchange soon.

"We have received the approval for cotton seed contracts from FMC. We will soon launch it on the exchange platform," NCDEX Managing Director and CEO Samir Shah told reporters.

The contract will be for the industrial grade cotton seed, with the basis centre in Akola, Maharashtra, he said.

The additional delivery centres will be in Yavatmal, Aurangabad (Maharashtra) and Rajkot (Gujarat).

The minimum ticket size will be Re 1 and the lot size 10 tonnes.

As NCDEX already have liquid and successful contracts of cotton seed oil cake, this contract would help crushers to hedge their raw material risk, Shah said.

India produces 10 to 11 million tonnes cotton seed annually.