Futures trading in natural rubber began on 15 March
2003 for the first time in India, when the first transaction
was entered into on the National Multi-Commodity Exchange
of India Ltd (NMCEIL) through Geojit Securities, the only
member of the exchange from Kerala.
Board chairman S Maria Desalphine inaugurated the futures
trading in natural rubber by clicking the transaction
at Geojit Securities trading terminal here. The
Ahmedabad-based NMCEIL, which is the only bourse that
offers futures trading in rubber in the country, will
trade in RSS-4 grade in the commodity and for April and
minimum contract size is 1 tonne. Instead of the conventional
outcry system, the futures trading in NMCEIL will take
place through the transparent screen-based online trading
system via V-Sat network.
after the inauguration, Desalphine said except in Malaysia,
the other countries, especially Singapore and Japan, have
an active futures market in rubber. Futures trading
will benefit the farmers as well as the traders in getting
an indication of the prices movements of the commodity
in the coming months.
first two contracts done showed the RSS-4 grade fetching
a price of Rs 4,650 per quintal for April and Rs 4,675
for May delivery. With the current prices ruling at Rs
4,450 per quintal, this two trades indicate that the rubber
prices will firm up in the coming months.
in rubber will bring in a better price-discovery mechanism.
Anonymity of trading participants and effective risk management
system ensure free and fair trading, says NMCEIL
managing director Kailesh Gupta.
commodity bourse, which has a total of 115 members across
the country, has an in-house clearing house in Ahmedabad
and has connectivity with all the members and clearing
banks, says Gupta. Delivery in the underlying commodities
will be backed by a warehouse receipt, which meets current
Kannan, regional manager, Central Warehousing Corporation,
which holds 26 per cent in NMCEIL, said the rubber stored
at CWC will be maintained in the highest quality. The
warehouse receipt-based trading system will expand and
deepen the commodities market in the country.
rubber farmers, a large percentage of whom are having
small holdings, will benefit immensely through the futures
trading. About 88 per cent of rubber production in India,
which is the third-largest producer of natural rubber
and the fourth-largest consumer of the commodity, is from
1 million small holdings with an average of 0.5 hectare.
R Jyothi Lal, agriculture director, Kerala, made the presidential
address. Apollo Tyres senior vice-president N Sreekumar,
Cochin Rubber Dealers Association president N Radhakrishnan
and Association of Planters in Kerala vice-president V
P Nampi also spoke on the occasion. C J George, managing
director, Geojit Securities, welcomed the gathering while
George Jacob, its advisor, proposed the vote of thanks.