MCX seeks Sebi approval to re-launch potato contracts

Mumbai, Jul 15 () Multi Commodity Exchange (MCX) has said it is seeking approval from market regulator Securities and Exchange Board of India to re-launch potato futures contracts.

"There is a need (of hedging) in sensitive commodities like pulses and sugar etc... We may soon be launching potato contracts," said Rishi Nathani, head of business development at MCX, while commenting on industry demand for robust farm futures trade in a webinar on agricultural reforms.

The exchange has applied to the Securities and Exchange Board of India (Sebi) for permission to re-launch the potato contracts, he stated.

MCX had a successful potato futures contract, few years ago, but it lost liquidity over a period of time due to which Forward Markets Commission, then regulator of the commodity derivatives market, asked MCX to stop trade in the contract in September 2014.

In the webinar on agricultural reforms, organised jointly by MCX and Indian Merchants' Chamber (IMC), food business major ITC stressed on necessity of a robust hedging platform to hedge price risks in number of commodities as the period of lockdown saw crude falling over 70 per cent, palm oil 30 per cent, and corn, wheat and potato too saw huge volatility hurting FMCG companies.

Tarkeshwar in West Bengal, Delhi and Agra in Uttar Pradesh are top potato trading centres with a robust warehousing infrastructure for the tuber crop, which is increasingly gaining importance in contract farming space among domestic and multinational food companies like Pepsi. SM ANS ANS