NMCE Commodity Report (6th Mar 2010)

                                                                                   Date - 06/03/2010

Press Release

TURMERIC FUTURES upwards And ISABGULSEED FUTURES slips

 Today National Multi Commodity Exchange of India ltd (NMCE) traded in 24 Commodities. The total volume is 45142 lots with a turnover of Rs.1110.73 crores.

ISABGULSEED FUTURES traded with a total volume of 436 lots and a turnover of 22Crs. 82Lakhs. The Total Open interest in all series was 15. April Series lost Rs.41 to close today at Rs.5170.00. June Series lost Rs.65 to close today at Rs.5225.00

TURMERIC FUTURES traded with a total volume of 264 lots and a turnover of 24Crs. 53Lakhs. The Total Open interest in all series was 11. March Series gained Rs.148 to close today at Rs.9560.00. April Series gained Rs.174 to close today at Rs.8904.00

COPRA FUTURES traded with a total volume of 4550 lots and a turnover of 16Crs. 88Lakhs. The Total Open interest in all series was 32. March Series gained Rs.7 to close today at Rs.3677.00. April Series gained Rs.10 to close today at Rs.3749.00

RAPE/MUSTARD SEED FUTURES traded with a total volume of 8548 lots and a turnover of 185Crs. 54Lakhs. The Total Open interest in all series was 139. March Series gained Rs.2 to close today at Rs.441.00. April Series gained Rs.2 to close today at Rs.434.00

NICKEL FUTURES traded with a total volume of 3196 lots and a turnover of 82Crs. 57Lakhs. The Total Open interest in all series was 35. March Series lost Rs.10.5 to close today at Rs.1021.50. April Series lost Rs.9.5 to close today at Rs.1026.00

RUBBER FUTURES traded with a total volume of 1190 lots and a turnover of 17Crs. 57Lakhs. The Total Open interest in all series was 8745. March Series gained Rs.11 to close today at Rs.14350.00. April Series gained Rs.23 to close today at Rs.14838.00. May Series gained Rs.34 to close today at Rs.15149.00. June Series gained Rs.59 to close today at Rs.15458.00

COPPER FUTURES traded with a total volume of 1522 lots and a turnover of 52Crs. 55Lakhs. The Total Open interest in all series was 19. April Series lost Rs.1.45 to close today at Rs.344.45. June Series lost Rs.1.5 to close today at Rs.346.15

ZINC FUTURES traded with a total volume of 2014 lots and a turnover of 106Crs. 64Lakhs. The Total Open interest in all series was 17. March Series gained Rs.1.1 to close today at Rs.106.70. April Series gained Rs.1.05 to close today at Rs.107.30

LEAD FUTURES traded with a total volume of 1164 lots and a turnover of 59Crs. 25Lakhs. The Total Open interest in all series was 15. March Series lost Rs.0.05 to close today at Rs.101.60. April Series lost Rs.0.1 to close today at Rs.102.55

PEPPER FUTURES traded with a total volume of 512 lots and a turnover of 6Crs. 63Lakhs. The Total Open interest in all series was 212. March Series gained Rs.2 to close today at Rs.12815.00. April Series lost Rs.10 to close today at Rs.13080.00. May Series gained Rs.36 to close today at Rs.13336.00. June Series gained Rs.58 to close today at Rs.13590.00. July Series gained Rs.81 to close today at Rs.13844.00. August Series gained Rs.104 to close today at Rs.14095.00

GOLD FUTURES traded with a total volume of 2556 lots and a turnover of 43Crs. 43Lakhs. The Total Open interest in all series was 8. March Series lost Rs.15 to close today at Rs.16980.00

SILVER FUTURES traded with a total volume of 134 lots and a turnover of 10Crs. 87Lakhs. The Total Open interest in all series was 8. May Series lost Rs.142 to close today at Rs.27030.00

KILOGOLD FUTURES traded with a total volume of 168 lots and a turnover of 28Crs. 39Lakhs. The Total Open interest in all series was 15. April Series lost Rs.50 to close today at Rs.16905.00

SACK FUTURES traded with a total volume of 1628 lots and a turnover of 63Crs. 61Lakhs. The Total Open interest in all series was 22. March Series gained Rs.22 to close today at Rs.3100.00. April Series gained Rs.21 to close today at Rs.3160.00

RAW JUTE FUTURES traded with a total volume of 364 lots and a turnover of 11Crs. 20Lakhs. The Total Open interest in all series was 15. March Series gained Rs.38 to close today at Rs.3080.00. April Series gained Rs.42 to close today at Rs.3142.00

COFFEE REP BULK FUTURES traded with a total volume of 582 lots and a turnover of 5Crs. 56Lakhs. The Total Open interest in all series was 25. March Series lost Rs.30 to close today at Rs.6384.00. May Series lost Rs.36 to close today at Rs.6410.00

CHANA FUTURES traded with a total volume of 746 lots and a turnover of 16Crs. 34Lakhs. The Total Open interest in all series was 17. March Series gained Rs.25 to close today at Rs.2171.00. April Series gained Rs.32 to close today at Rs.2239.00

GUARGUM FUTURES traded with a total volume of 220 lots and a turnover of 10Crs. 41Lakhs. The Total Open interest in all series was 36. March Series gained Rs.57 to close today at Rs.4784.00

CASTOR SEED 10 MT FUTURES traded with a total volume of 290 lots and a turnover of 8Crs. 24Lakhs. The Total Open interest in all series was 24. April Series gained Rs.4 to close today at Rs.2846.00

GUARSEED 10 MT FUTURES traded with a total volume of 8066 lots and a turnover of 188Crs. 77Lakhs. The Total Open interest in all series was 176. March Series gained Rs.11 to close today at Rs.2340.00. April Series gained Rs.8 to close today at Rs.2365.00

SOYOIL 10 MT FUTURES traded with a total volume of 2580 lots and a turnover of 120Crs. 13Lakhs. The Total Open interest in all series was 25. March Series lost Rs.0.2 to close today at Rs.464.50. April Series lost Rs.0.5 to close today at Rs.468.10

MENTHOL CRYSTAL FUTURES traded with a total volume of 178 lots and a turnover of 1Crs. 20Lakhs. The Total Open interest in all series was 7. March Series lost Rs.2 to close today at Rs.673.00

ALUMINIUM 5 TON FUTURES traded with a total volume of 446 lots and a turnover of 22Crs. 39Lakhs. The Total Open interest in all series was 15. March Series lost Rs.0.7 to close today at Rs.101.00. April Series lost Rs.0.65 to close today at Rs.102.20

GOLD GUINEA FUTURES traded with a total volume of 3788 lots and a turnover of 5Crs. 06Lakhs. The Total Open interest in all series was 4756. March Series lost Rs.27 to close today at Rs.13357.00. April Series lost Rs.25 to close today at Rs.13437.00. May Series lost Rs.41 to close today at Rs.13495.00

Future of Futures Trading

Future of Futures Trading

With globalization India felt the need to have the tools to manage the price risk and proper price discovery of the huge commodities that it was either producing or consuming. Thus the need for commodity exchanges, matching international standards was felt. These exchanges are modern, having best of the technology, risk management and surveillance. These exchanges, in the last few years have been able to grow at rapid pace and have brought all the stakeholders (producers, traders, processors, speculators, arbitragers, investors and consumers) into its fold.

Leading the way has been National Multi commodity Exchange (NMCE) of India Ltd., the pioneer exchange which has revolutionized the commodity trade in the country. NMCE, since inception has positioned itself as an exchange for the purpose of price discovery, price risk management, transparent transactions and seamless hedging and compulsory delivery as dispute free settlement.

NMCE’s product offering is built around agricultural commodities with 75% of its turnover accruing from agri- commodities and 25 % from bullion and metals. Among agricultural commodities, rubber, coffee, pepper, castor seed, sacking, guar seed, chana, soy oil, etc are actively traded. It also has a 100% market share in commodities like rubber, coffee, copra, sacks and isabgul seeds.

In order to improve its presence in the industry, NMCE has brought about key changes in its operations. Since September 2008, NMCE has increased its trading window by starting an evening session and launching international commodities such as coffee, bullion and metals. Also, the exchange has been consistently improvising its product basket which has increased from eight commodities to 20 currently. On the back of these developments as also the increasing penetration of commodity markets in the country, the exchange is seeing a revival in turnover. In FY09, NMCE registered a turnover of US$12bn – a jump of 142% year on year. The leading bourse has also seen a jump in Pan-India membership by 100% in the last two years.

NMCE has shown a tremendous growth in the FY 2009-10, as the exchange has already exceeded the previous year’s turnover in the first five months of the current year. It has also managed to add newer member across the country. The exchange expects a growth of around 200% by the end of the FY.

NMCE is aggressively pushing various initiatives it has taken recently. These include:

1. Substantial increase in Membership:

NMCE added close to 100 new members last year and brought the tally to over 300 members. The projections predict another 150 members this year. The membership is coming from existing geography and new geography as well helping it spread pan India.

2. NMCE integration on ODIN:

NMCE is being integrated on flagship ODIN of FTIL. This would increase the reach of NMCE to around 35,000 terminals and would also help large broker members to do the client level risk management. This would increase their participation which in turn would grow the volume.

3. Investment in Exchange Ecosystem:

NMCE has taken initiatives, in co-operation with APMC for setting up spot exchange in the name of National APMC which has already been registered and has got the approval from the Govt. of Gujarat. Additionally, it is making investments in the field of technology and warehousing.

4. Increase the Size of the Market:

The exchange is focused to increase the size of the market where they have their strong foothold, in commodities like rubber, coffee, castor seed, chana, copra, sackings, Isabgul etc and increase the %age share in other commodities where they have comparatively lesser share. The exchange is also planning to come up with new and innovative products, the first initiative being the Gold Guinea.

5. Training programs:

NMCE is conducting various training programs for the traders at terminal operator level so that proper guidance reaches the grass root level. It is a mammoth task but the pioneer commodity exchange has already undertaken this.

6. Technology Initiatives:

There are a lot of initiatives on technological enhancement front such as new Traders Work Station, Client Work Station; Mobile based trading application, SMS Service, Price Dissemination Project in mandis, unique delivery settlement system and warehouse management systems.

7. Warehouse Receipt Financing:

NMCE is also going to increase warehouse receipt financing with many more banks. It has been very helpful for delivery based farmers, small and big traders.

Today, the turnover on the exchanges has increased to over $ 1 trillion which is approximately thrice the size of the physical commodity market in India. Leveraging the strong US$320bn physical commodities market (valued at 45% of India’s GDP), Indian commodity exchanges are over-riding structural inefficiencies and are headed towards growth.

The size of the commodity derivative markets in the developed nations is usually 30-40 times the underlying physical markets, while in India it stands at three times. Thus, there exists a scope of ten-fold growth for the Indian commodity exchanges. And to add to this, the turnover of the commodity exchanges has registered 40 times growth over the last five years, exhibiting the ability of the commodity exchanges to exploit  the huge potential that exists.