NCDEX launches India's first steel scrap futures contract: Key details

The National Commodity and Derivatives Exchange (NCDEX) has launched India’s first Price Reporting Agency (PRA)-based futures contract in steel scrap, seeking to bring greater price transparency and an organised hedging mechanism to a market characterised by fragmented trading and diverse scrap grades.

The contract, based on Heavy Melting Scrap (HMS) 80:20, introduces an exchange-traded benchmark for steel scrap prices, allowing market participants to manage price volatility and hedge their exposure. HMS 80:20, comprising 80% Heavy Melting Scrap Grade 1 and 20% Grade 2, is an internationally recognised grade and among the most widely referenced scrap benchmarks across Asian markets.

The launch follows a recent memorandum of understanding between NCDEX and BigMint Technologies, under which BigMint, a commodity market intelligence and price reporting agency, will serve as the price reference agency for the contract. The partnership will combine NCDEX’s derivatives market infrastructure with BigMint’s price assessment expertise.


Steel scrap is an important raw material in steel manufacturing, particularly as the industry increasingly moves towards resource-efficient and sustainable production. However, the absence of a credible exchange-traded benchmark has limited the ability of market participants to manage price risks in a market where prices vary across grades and locations.

“Steel scrap is an increasingly important component of India’s steel value chain, particularly as the industry advances towards more resource-efficient and sustainable manufacturing practices. Yet its price risk has had no exchange-traded answer. By introducing India’s first PRA-based futures contract in steel scrap and bringing in global standards of data and governance following an IOSCO-compliant framework, NCDEX fills that gap,” said Vikas Goel, managing director and CEO of NCDEX.

The contract will have a trading unit of 10 metric tonnes (MT), with a maximum order size of 500 MT and a tick size of ₹10 per MT. It will be cash-settled, with Mandi Gobindgarh in Punjab designated as the basis centre. Prices will be quoted exclusive of GST.

The launch comes at a time when India's steel industry is expanding its production capacity and increasing its use of scrap as a raw material. India remained the world's second-largest crude steel producer, with output growing 10.7% year-on-year to around 168.4 million tonnes in 2025-26, even as global crude steel production declined by approximately 2%, according to World Steel Association data.

Domestic steel scrap generation has also increased 22% year-on-year to around 32 million tonnes, reflecting the growing importance of scrap in the country's steel ecosystem.

The new futures contract is expected to provide steel producers, scrap processors, traders and other value-chain participants with a transparent price discovery mechanism and a formal avenue to manage price fluctuations.