The Hindu Business Line : MCX to start trading by Sept-end

The exchange proposes to conduct futures trading in gold, silver, cotton, castor, rubber and pepper in the first phase. This may be enlarged further to cover palmolein and soya.

COIMBATORE, June 30

MULTI-Commodities Exchange of India Ltd (MCX), one of the four national-level multi-commodities exchanges approved by the Forward Markets Commission for conducting the futures trading, is expected to start trading operation by end-September.

The promoters of the MCX are currently on their last leg for the launch - appointing brokers across the key commodity cities/zones.

As a prelude, the MCX is busy holding roadshows targeting potential candidates to be taken as members or intermediaries to represent the exchange at major business centres.

`Though there is no cap on the number of brokers we should take, we are looking in the region of some 250 or so to start with who would be appointed at national level. This number can go up subsequently as these brokers could have their sub brokers extended into taluk levels too, maybe in a couple of years', said Mr Joseph Massey, Deputy Managing Director of the Multi Commodity Exchange of India Ltd.

Promoted by the Mumbai-based Financial Technologies (India) Ltd, the private multi-commodity exchange, has proposed to conduct futures trading in gold, silver, cotton, castor, rubber, pepper in the first phase which may be possibly enlarged further to cover palmolein and soya.

With its infrastructure to facilitate on-line trading in place, the MCX has been in dialogue with various national farmers co-operatives to woo them to take up the membership.

The exchange promoters have also tied up with state warehousing corporations handling commodities in Kerala, Uttar Pradesh, Gujarat and Tamil Nadu, which will be associates for the exchange's trading in commodities.

`We have also taken HDFC Bank, IndusInd Bank and the SBI which would be offering custodial services for the futures trading in the bullion', said Mr Massey who was here to participate in a roadshow organised here on Monday by MCX for the members of the commodity trade, bullion trade and the financial intermediaries.

Talking to Business Line, Mr Massey expressed the confidence that the daily turnover in the proposed exchange could be lifted to the levels of Rs 400 crore within months of commencement. .

His hopes on the brighter fortunes for the commodities exchanges stems from what he called the twin factors likely to happen within the next two years - convertibility of rupee in the capital account and the fully opened up global trading under WTO rules which would have a vast bearing on Indian agri-commodities markets.

Financial Technologies India Ltd currently holds the entire stake at the MCX with a total investment of Rs 20 crore, but the company may at a later date go for widening the ownership of the company through equity distribution, said Mr Joseph.

MCX will be on membership scouting till July 11 by then it would have covered another 12 or so cities in its roadshow.

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