2.9 C
New York
Wednesday, February 1, 2023

India extends suspension of futures trade in key farm commodities

MUMBAI/ BENGALURU: India’s market regulator extended the suspension of trading in derivative contracts of key farm commodities by a year as the world’s biggest importer of vegetable oils, and a major producer of wheat and rice, tries to tame food inflation.

The Securities and Exchange Board of India (SEBI) had last year ordered a year-long suspension of futures trading in key farm commodities, a dramatic step since allowing futures trading in 2003. In a notification issued late on Tuesday, SEBI said the suspension of trading in futures contracts would continue until Dec. 20, 2023, on soybean and its derivatives, crude palm oil, wheat, paddy rice, chickpea, green gram and rapeseed mustard.

The extension surprised the market participants who were expecting trading to resume after annual retail inflation eased in November below the central bank’s upper tolerance level for the first time this year amid a softer rise in food prices.

The industry was eagerly expecting the government to lift the suspension, particularly in commodities such as palm oil and soyoil, where prices follow the movements in global markets, said B.V. Mehta, executive director of The Solvent Extractors’ Association of India. “The extension to suspension is a setback.

Trade and industry will be deprived of hedging and price discovery mechanism for smooth business operation and will be exposed to price volatility,” Mehta said. India fulfils nearly two-third of its edible oil requirement through the imports.

India extends suspension of futures trade in key farm commodities

Source: Brecorder

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

11,268FansLike
12,893FollowersFollow
742FollowersFollow
- Advertisement -

Latest Articles

Popular Articles