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SBOT launches mustard futures

M. R. Subramani

CHENNAI, Sept. 6

THE Sopa Board of Trade (SBOT) has quietly flagged off futures trading in mustard/rapeseed oil, seed and its cake and is now planning to launch futures in sugar and gram, a top SBOT official said on Wednesday.

SBOT is being run by the Soyabean Processors Association of India (Sopa) in Indore, which is the hub of soyabean cultivation in the country.

``We have started futures trading in mustard/rapeseed allotting a different timing slot for it. Trading is yet to pick up because it is off-season now,'' the SBOT Director, Mr. A.S. Jeyakumar, told Business Line.

The futures trading in the commodity was launched on August 19, he said.

Currently, the volume of business in mustard/rapeseed was around Rs. 1 crore, he said, expressing confidence that trading would pick up once the season began. SBOT has got permission to hold futures trading in this for five years.

Mustard/rapeseed production in the country is about 55 lakh tonnes and is the third largest oilseed crop after groundnut and soyabean.

Asked about trading in soyaoil, Mr. Jeyakumar said the trading was sizeable with a daily turnover of Rs. 20-22 crores.

``At the moment, we are trading in soyaoil only. We will start trading in soyameal and feed soon,'' he said.

The exchange had held roadshows in the northern and central parts of the country to spread awareness among farmers and traders on the futures trade.

Mustard/rapeseed is mainly grown in Rajasthan, Uttar Pradesh and Madhya Pradesh.

Mr. Jeyakumar said SBOT board had cleared a proposal to start futures trading in sugar and gram (channa).

``We plan to hold futures trading in sugar and gram. We have talked to the Consumer Affairs Ministry and will file an application soon,'' he said.

The Consumer Affairs Ministry supervises the functions of the commodity exchanges in the country through the Forward Markets Commission (FMC). The FMC had recently cleared a proposal for holding futures trading in sugar. The proposal is now pending with the Government for approval.

On launching the futures trading online, Mr. Jeyakumar said it would take another three to four months before the present open outcry system gave way to screen-based trading.

``We are working on the online system. It should start in the next three to four months,'' he said.

SBOT had launched futures trading in soyabean, its oil and cake in February this year after getting the Consumer Affairs Ministry approval in the second half of 1998.