Posts Tagged ‘FMC’

News Round Up 2nd -6th August 2010

•India’s food ministry proposes to sell 2.74 million metric tonnes of food grain over the next six months from federal stocks in a bid to free-up warehouse space.

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•The government has allowed export of 3,00,000 tonnes of rice and wheat through diplomatic channels to Bangladesh and Nepal.

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•Soyabean Processors Association of India expects soybean production in the country at 85 lakh tonnes (lt), which is far below last year’s 95 lt.

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•Turmeric area in Andhra Pradesh stood at 0.53 lakh hectare against 0.41 lakh hectare, nearly 101 % of the normal area covered.

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•Water level in India’s main reservoirs was at 19 per cent of capacity on July 22, 2 per cent higher than the previous week’s level, government data showed.

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•Wholesale Price Index For food articles 9.67% on week ending 17 July against 12.47% previous week.

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•Commodity futures market regulator FMC may consider the creation of an appellate tribunal akin to that in stock markets for the resolution of disputes between clients and brokers.

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•Supply from the OPEC (except Iraq) has averaged 26.95 million barrels per day (bpd) this month, up from 26.75 million bpd in June, according to the survey of oil firms, OPEC officials and analysts.

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Rabi Sowing Picks Up in State

Hello Friends here we come up with the Latest Agri Commodities updates from various parts of the country.

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Rabi sowing picks up in State

Rabi sowing picks up in State:

The recent rain in several parts of Karnataka seem to be playing a key role in rabi sowing with farmers going in for large-scale coverage of jowar, Bengal gram and sunflower, particularly in the northern districts.


As sowing is in progress, data from the Agriculture Ministry shows that rabi crops were sown on 27.05 lakh hectares of land accounting for 73 per cent progress against the target of 37 lakh hectares as on November 18.


Sowing of maize, wheat, Bengal gram and sunflower continued in the northern districts while transplanting of paddy and sowing of black gram was in progress in parts of Dakshina Kannada and Udupi.

Bengal gram has been sown on 8.78 lakh hectares of land against 7.67 lakh hectares during the corresponding period last year, while jowar, the major rabi crop, has been sown on 9.25 lakh hectares, wheat on 1.9 lalkh hectares, and sunflower on 2.90 lakh hectares.


Overall coverage of pulses such as Bengal gram, horse gram, black gram, green gram, cowpea and avare stood at 9.93 lakh hectares against the coverage of 8.99 lakh hectares last year.


However, the area under cereals — rice, jowar, ragi,maize, wheat, and minor millets — trails at 12.32 lakh hectares against 14.39 lakh hecatres during the corresponding period last year.

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In Other major Commodities Updates we can see  FMC has recently instructed bourses to ensure compliance of the PMLA and Sugar production in India may exceed estimated figures.

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Commodity bourses must follow PMLA norms : “FMC”

In order to step up the regulatory grip on commodity derivatives market, Forward Markets Commission (FMC) has recently instructed bourses to ensure compliance of the Prevention of Money Laundering Act 2002 (PMLA) by their members.


“This is more of a pre-emptive step to prevent unscrupulous money coming into our (commodity futures) market,” BC Khatua, chairman, FMC, said.

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Sugar output may beat estimates “Survey”:

Sugar production in India, the world’s second-largest grower, may be 11 percent more than estimated after farmers boosted planting and yields improved because of increased fertiliser use.


Output may jump to 17.68 million metric tonne in the season started Oct. 1, according to interviews with 631 farmers across six states by Geneva-based SGS SA for Bloomberg.


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IMCX-India’s Fourth National Commodity Bourse, To Be Launched Soon:)

IMCX-to-be-launched

International Multi Commodity Exchange (IMCX)

Commodity trading in India has a long history & was started much before it started in many other countries.

Today, apart from numerous regional exchanges, India has three national commodity exchanges namely, Multi Commodity Exchange (MCX), National Commodity and Derivatives Exchange (NCDEX) and National Multi-Commodity Exchange (NMCE).

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THE RISING WAVES

These commodity exchanges have been performing extremely well in these years.

The turnover of commodity exchanges in India surged by 31% in the April-August period, led by a surge in trading of farm goods.

Total value of trading at the Commodity Exchanges during the fortnight from 16th August 2009 to 31st August 2009 was Rs. 3,04,651.88 crore.

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NEED OF THE HOUR

In India, futures’ trading in commodities is zooming.

India’s commodity exchanges have witnessed major action this year and are getting into investing and managing new commodity bourses.

Another commodity exchange may help using the opportunities better ; thereby improving trading volumes of specific contracts & be more efficient is the price discovery, which in turn will attract a wider constituency of participants from the entire commodity value chain i.e. government, producers, marketers, importers, exporters etc.

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THE FIRST STEP

A new commodity exchange, International Multi Commodity Exchange is going to launch very soon under the market regulator Forward Markets Commission (FMC).

IMCX is promoted by Indiabulls Financial Services Ltd (IBFSL) and India’s biggest state-run trading firm, MMTC Ltd, and part-owned by more institutions.

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The exchange is planning to start operations next month as the country’s fourth national commodity bourse & is ready to grab its share of a futures market that is growing 30% a year.

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BUILDING TECH – PLATFORM

The US-based exchange services provider Millennium Information Technology (MIT) has been awarded the contract for implementing the technology platform for the aforesaid exchange.

The US-headquartered MIT provides application solutions to financial and telecom industries.

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THE PILLARS OF FOUNDATION

IMCX will be the first commodity bourse in India to comply with the criteria of revised ownership criteria that makes the participation compulsory of public sector units or cooperatives.

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Currently, Indiabulls Financial Services Ltd. (IBFSL) holds 40% of the exchange, state-run MMTC Ltd. holds 26%.

Forward Markets Commission rejected the United Stock Exchange of India’s (USE’s) 10% stake buy in the bourse, on the grounds that the stock exchange is yet to be fully recognized.

So far, Indiabulls has diluted 24 per cent to HDFC Bank, Yes Bank and Indian Potash Ltd & IDFC + Krishak Bharati Cooperative Limited (KRIBHCO) have purchased a stake of 5% each in Indian Commodity Exchange, which was to be sold to the USE earlier.

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BUSINESS OPERATIONS

The exchange will start operations by launching 10-12 contracts in bullion, metals, energy and agricultural commodities with some uniqueness in contracts to attract more volume.

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·The exchange will launch gold mini and gold 1 kilogram contracts in the bullion segment. The gold contracts will have multiple delivery centers in five-six cities.

· In base metals, it is planning to offer copper, zinc and lead or nickel futures, and in the energy segment it will launch crude oil and natural gas contracts. Delivery-based contracts will be launched in the base metal segment, where contracts are mostly non-deliverable at other exchanges.

·The exchange has also tied up with several logistic providers for warehouse facilities, & in the next phase of expansion, the exchange may create its own warehouses

·Guar seed, rapeseed, refined soyoil, soybean and turmeric will be among the agricultural contracts.

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IDFC, KRIBHCO Buy 5% Stake Each in ICE :)

IDFC-KRIBHCO-buy-5%-stake

IDFC and Krishak Bharati Cooperative Limited (KRIBHCO)have purchased a stake of  5% each in Indian Commodity Exchange, which jointly promoted by Indiabulls Financial Services and MMTC.

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According to sources, the bourse will apply to Forwards Markets Commission, the regulator, after the completion of the formalities of the shareholding agreement.

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With the latest divestment, the current holding of Indiabulls stood at 40% while MMTC has 26%. The other shareholders include HDFC Bank, Yes Bank and Indian Potash.

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FMC guidelines stipulate a maximum shareholding of 40% in a commodity exchange by an anchor investor.
This has to be reduced to 26% within a period of two years starting with the fourth year from the date of exchange’s recognition.

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Earlier, FMC (Forward Markets Commission) rejected United Stock Exchange’s proposal to pick up 10% stake in Indian Commodity Exchange since it was yet to receive full recognition from capital markets regulator SEBI.

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The bourse is the latest entrant into the commodity futures space and will vie with the predominantly metals and energy bourse MCX and agri bourses NCDEX and NMCE.

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In August, FMC had directed the exchange, which had received recognition from the Ministry of Commerce over a year ago, to offer 10 per cent equity of USE to other competent partners and re-submit the application by September-end.

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