Latest news with #NCDEX
India Gazette
05-07-2025
- Business
- India Gazette
India's First Weather Derivative aims to protect farmers from weather volatility
New Delhi [India], July 5 (ANI): Highlighting the potential benefits of the recent Memorandum of Understanding (MoU) between the National Commodity & Derivatives Exchange (NCDEX) and the India Meteorological Department (IMD), Dr Mrutyunjay Mohapatra, Director General of IMD, said the collaboration would provide critical climate insights for the agriculture sector. He noted that farmers and agri-based industries can use historical weather data to assess whether areas are drought-prone, flood-prone, or receive normal rainfall. 'So, under this memorandum of understanding, rainfall has been taken into consideration because rain is the most important parameter concerning agriculture and hence the economy. Towards this direction, the historical data will also be provided by IMD so that there can be an assessment with respect to the climatic hazard potential of rainfall during the monsoon season. And also the real-time rainfall; whatever is available from IMD in the gridded format or point rainfall will be provided to assess the variation of rainfall on their end and also to provide the services,' he added. 'Agriculture in our country depends especially on monsoon rain because 70-90 per cent of rainfall occurs in this season,' IMD DG Mrityunjay Mohapatra said. 'On the real-time rainfall, they can find out whether it is as per the climatological trend or there is a deviation... Accordingly, there could be some decisions concerning agriculture as well as agro-business and industry,' he added. Based on this information, stakeholders can make informed decisions in agriculture, agro-business, and related industries, IMD DG added. National Commodity & Derivatives Exchange Limited (NCDEX) and the India Meteorological Department (IMD) signed a landmark Memorandum of Understanding (MoU) on 26 Jun 2025. This strategic alliance lays the critical groundwork for the launch of India's first weather derivatives--a long-anticipated market instrument designed to help farmers and allied sectors hedge against climate-related risks such as erratic rainfall, heatwaves, and unseasonal weather events. With this partnership, NCDEX will develop a rainfall-based derivative product, among others, using historical and real-time datasets sourced from IMD. These datasets are extensively graded and quality verified, offering high-precision insights that can mimic real-world conditions with statistical accuracy. The weather product to be developed under this collaboration will enable seasonal and location-specific derivative contracts. They shall advance expertise on weather-related risks across agriculture, transportation, and allied industries. Arun Raste, Managing Director & CEO, NCDEX, said, 'This partnership with IMD opens the door to a new era in commodity markets. Weather derivatives have long been a foundational need towards building a climate-resilient rural economy. With climate volatility increasingly affecting the productivity and income of farmers, these instruments provide a market-based solution to weather risk. It gives me immense pleasure that NCDEX has taken the first step in bringing this innovation to India, empowering farmers, traders, and even sectors like tourism and transport to manage climate uncertainty more effectively.' The collaboration will support capacity-building, joint research, and training programmes for stakeholders including FPOs, agri-traders, policy think tanks, and analysts. (ANI)
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Business Standard
03-07-2025
- Business
- Business Standard
Forecast meets futures with NCDEX to tap real-time IMD weather data
This would help NCDEX develop statistically validated weather indices that form the foundation of weather-linked futures contracts New Delhi Listen to This Article In a step towards the formal launch of India's first weather derivatives, the country's leading commodity exchange, the National Commodity & Derivatives Exchange (NCDEX), and premier state-run weather forecaster, the India Meteorological Department (IMD), on Thursday signed a memorandum of understanding (MoU) that will give the former access to IMD's historical and real-time weather data. This would help NCDEX develop statistically validated weather indices that form the foundation of weather-linked futures contracts. The agreement is after weather derivatives were included in the Securities Contracts (Regulation) Act, 1956 (SCRA), in 2024, paving the way for commodity exchanges to offer them as
Time of India
03-07-2025
- Business
- Time of India
NCDEX, IMD ink pact to launch India's first weather derivatives
The National Commodity and Derivatives Exchange Ltd ( NCDEX ) on Thursday said it has inked an agreement with the India Meteorological Department ( IMD ) that will lay critical groundwork for launching India's first weather derivatives . This Memorandum of Understanding (MoU), signed on June 26, lays the critical groundwork for the launch of India's first weather derivatives -- a long-anticipated market instrument designed to help farmers and allied sectors hedge against climate-related risks such as erratic rainfall, heatwaves, and unseasonal weather events, NCDEX said in a statement. With this partnership, NCDEX will develop a rainfall-based derivative product, among others, using historical and real-time datasets sourced from IMD. Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Text Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Transparent Caption Area Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Drop shadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Treatment That Might Help You Against Knee Pain Knee pain | search ads Find Now Undo "While our endeavour is to launch it early so that stakeholders benefit. We will need time for developing a product considering southwest and eastern monsoon cycles and then test our hypothesis before we submit it for regulatory approval and it is difficult to give any concrete timeframe at this juncture," NCDEX Managing Director and CEO Arun Raste told PTI. The weather product to be developed under this collaboration will enable seasonal and location-specific derivative contracts and will advance expertise on weather-related risks across agriculture , transportation, and allied industries. Live Events "This partnership with IMD opens the door to a new era in commodity markets. Weather derivatives have long been a foundational need towards building a climate-resilient rural economy . With climate volatility increasingly affecting productivity and income of farmers, these instruments provide a market-based solution to weather risk," Raste said. The collaboration will support capacity-building, joint research, and training programmes for stakeholders, including FPOs, agri-traders, policy think tanks, and analysts. "IMD has always played a vital role in supporting agriculture and disaster resilience. Through this collaboration with NCDEX, we are now extending our scientific capabilities into the financial domain, allowing weather data to become a powerful instrument of economic stability and market innovation," IMD Director General of Meteorology Mrutyunjay Mohapatra said.
Time of India
27-06-2025
- Business
- Time of India
Maha opens hedging desk to train farmers in futures and options for cotton, maize and turmeric
Nagpur: The state govt is looking at futures and options to help farmers deal with risk due to price volatility in agriculture produce. In what is dubbed to be the first-ever move by the state, Maharashtra has opened a hedging desk in Pune covering cotton, the main crop of Vidarbha, as well as turmeric and maize. Over 3,000 farmers will be trained in hedging tools and strategies. Training will be given to farmers' producers' organisations (FPOs) and farmers in regions cultivating cotton, turmeric, and maize, particularly in Hingoli, Washim, Sangli, Yavatmal, Akola, Nanded, Amravati, Chhatrapati Sambhaji Nagar, and Beed. Turmeric is also grown in parts of Vidarbha, especially Waigaon in Wardha district, as the area under maize is also slowly going up in the region. The hedging desk, which has been brought under the Balasaheb Thackeray Agribusiness and Rural Transformation (SMART) project, will be supported by the National Commodity Derivative Exchange (NCDEX), one of the two commodity bourses in the country. The desk will be training FPOs for dealing in futures and options. It will provide hand-holding to the FPO members and ultimately facilitate deals at the exchange, said Neeraj Shukla, chief advisor for risk mitigation and hedging desk at NCDEX. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch CFD với công nghệ và tốc độ tốt hơn IC Markets Đăng ký Undo At present, futures trading can happen in cotton and maize, while options are available only for maize. Futures and options are two different methods of hedging. For example, a cotton farmer can fix a deal at a certain price for delivering the produce at a given date in the future — maybe at the time of harvest. This can provide a hedge against the possibility of rates going down at that time. Deals can be squared off without actual delivery of the commodity too, explained an NCDEX source. A Risk Management Cell will formulate mitigation strategies. It will publish Annual Commodity Price Risk Assessment Reports for cotton, maize, and turmeric, offering current insights, forecasts, and policy recommendations too.
Hans India
12-06-2025
- Business
- Hans India
The Top 5 Most Active Commodities for Trading in India
India's dynamic commodity markets offer many opportunities for traders and investors, fueled by the nation's immense consumption, agricultural backbone, and burgeoning industrial sector. While the direct ownership of physical commodities can be impractical, financial instruments such as futures contracts and Contracts for Difference (CFDs) provide accessible avenues for speculating on price movements and gaining exposure to these vital markets. In India, commodity futures trading is predominantly facilitated by two major exchanges: the Multi Commodity Exchange (MCX) and the National Commodity & Derivatives Exchange (NCDEX). The MCX leads the non-agricultural segment to trade commodities, encompassing precious metals, industrial metals, and energy, while the NCDEX specializes in agricultural commodities. This article will explore India's five most actively traded commodities, exploring their market dynamics. 1. Gold: The Eternal Safe Haven and Cultural Cornerstone Gold holds a unique and revered position in the Indian psyche, extending far beyond mere investment to encompass deep cultural and traditional significance. It is an indispensable part of weddings and festivals, and a crucial generational asset. This deep-rooted domestic demand and its global status as a safe-haven asset firmly establish gold as one of India's most actively traded commodities. Market Dynamics and Price Influencers: Cultural and Festival Demand: Indian festivals and wedding seasons consistently drive significant gold demand, notably influencing local prices. Global Economic Conditions: During economic uncertainty, geopolitical tensions, or inflationary pressures, investors flock to gold as a store of value, pushing prices higher. Conversely, a strong global economy and rising interest rates (making fixed-income assets more appealing) can exert downward pressure. During economic uncertainty, geopolitical tensions, or inflationary pressures, investors flock to gold as a store of value, pushing prices higher. Conversely, a strong global economy and rising interest rates (making fixed-income assets more appealing) can exert downward pressure. Central Bank Monetary Policies: Interest rate decisions by major central banks (such as the US Federal Reserve) significantly impact gold prices. Higher interest rates increase the opportunity cost of holding non-yielding assets like gold. US Dollar Strength: Gold is predominantly priced in US dollars. A stronger dollar makes gold more expensive for holders of other currencies, potentially dampening demand and vice versa. Inflation Expectations: Gold is widely regarded as a hedge against inflation. When inflation rises, a currency's purchasing power declines, prompting investors to seek refuge in assets like gold, which tend to retain their value. Gold is widely regarded as a hedge against inflation. When inflation rises, a currency's purchasing power declines, prompting investors to seek refuge in assets like gold, which tend to retain their value. Supply and Demand Fundamentals: Global mining output, recycling activities, and demand from jewelry manufacturers and industrial applications all influence price discovery. Global mining output, recycling activities, and demand from jewelry manufacturers and industrial applications all influence price discovery. Appeal for Traders: Gold's consistent liquidity, sensitivity to global macroeconomic factors, and traditional safe-haven appeal make it a popular choice for short-term speculative trading and long-term hedging against economic instability. 2. Crude Oil: The Global Economy's Energy Powerhouse Crude oil, often dubbed "black gold," is the lifeblood of the global economy. As a primary energy source for transportation, industrial production, and electricity generation, its price fluctuations have far-reaching implications. As a major oil importer, India is particularly sensitive to global crude oil price movements, making it an extremely active commodity for trading. Market Dynamics and Price Influencers: Global Supply and Demand Balance: The fundamental principle of supply and demand dictates crude oil prices. Economic growth fuels demand, while production levels from major oil-producing nations (OPEC+, US shale producers, Russia) directly influence supply. The fundamental principle of supply and demand dictates crude oil prices. Economic growth fuels demand, while production levels from major oil-producing nations (OPEC+, US shale producers, Russia) directly influence supply. Geopolitical Tensions: Conflicts and instability in key oil-producing regions (e.g., the Middle East) can disrupt supply chains and trigger significant price spikes. Conflicts and instability in key oil-producing regions (e.g., the Middle East) can disrupt supply chains and trigger significant price spikes. OPEC Decisions: The Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) play a pivotal role in managing global oil supply through production quotas, directly impacting prices. The Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) play a pivotal role in managing global oil supply through production quotas, directly impacting prices. Key Economic Indicators: Industrial production data, manufacturing output, and global GDP growth forecasts all impact the outlook for crude oil demand. Industrial production data, manufacturing output, and global GDP growth forecasts all impact the outlook for crude oil demand. Currency Exchange Rates: The INR to USD exchange rate is a crucial factor for India. A weaker rupee makes imported oil more expensive in terms of local currency. The INR to USD exchange rate is a crucial factor for India. A weaker rupee makes imported oil more expensive in terms of local currency. Technological Advancements: Developments in extraction methods (like fracking) can increase supply, while advancements in renewable energy sources can influence long-term demand trends. Trading Avenues in India: Appeal for Traders: Crude oil's high volatility and sensitivity to a wide array of global events provide ample opportunities for speculative traders. Its direct impact on inflation and economic growth makes it a crucial commodity for macro-focused traders. 3. Silver: The Dynamic Industrial Precious Metal While often in the shadow of gold, silver firmly holds its own as both a precious metal and an industrial commodity. Its dual nature makes its price dynamics fascinating and frequently more volatile than gold. In India, silver is extensively used in jewelry, silverware, and various industrial applications, making it a prominent commodity in the trading landscape. Market Dynamics and Price Influencers: Industrial Demand: A substantial portion of silver's demand originates from industrial applications, including electronics, solar panels, the automotive industry, and medical devices. This makes its price highly sensitive to global industrial growth and technological advancements. A substantial portion of silver's demand originates from industrial applications, including electronics, solar panels, the automotive industry, and medical devices. This makes its price highly sensitive to global industrial growth and technological advancements. Investment Demand: Like gold, silver also functions as a safe-haven asset, attracting investment during economic uncertainty and inflationary pressures. Like gold, silver also functions as a safe-haven asset, attracting investment during economic uncertainty and inflationary pressures. Correlation with Gold Prices: Silver often moves in tandem with gold, though typically with higher volatility due to its smaller market size and significant industrial demand component. Silver often moves in tandem with gold, though typically with higher volatility due to its smaller market size and significant industrial demand component. Mining Output: Most silver is produced as a byproduct of mining other metals (such as lead, zinc, copper, and gold), making its supply somewhat inelastic to direct silver price changes. Most silver is produced as a byproduct of mining other metals (such as lead, zinc, copper, and gold), making its supply somewhat inelastic to direct silver price changes. Currency Fluctuations: Similar to gold, a stronger US dollar can make silver more expensive for international buyers, potentially impacting demand. Similar to gold, a stronger US dollar can make silver more expensive for international buyers, potentially impacting demand. Appeal for Traders: Silver's compelling combination of industrial utility and precious metal status makes it an attractive asset. Its higher volatility than gold can lead to larger profit opportunities, albeit with increased risk. 4. Natural Gas: The Evolving Transition Fuel Natural gas is an increasingly vital global energy source for electricity generation, industrial processes, and residential heating. Its clean-burning properties position it as a key transition fuel in the worldwide shift towards renewable energy. In India, growing domestic consumption and increasing industrial reliance on natural gas contribute significantly to its active trading on commodity exchanges. Market Dynamics and Price Influencers: Seasonal Demand: Natural gas prices are highly influenced by seasonal weather patterns, with demand typically peaking during colder winter months (for heating) and hotter summer months (for air conditioning, impacting electricity generation). Natural gas prices are highly influenced by seasonal weather patterns, with demand typically peaking during colder winter months (for heating) and hotter summer months (for air conditioning, impacting electricity generation). Supply Levels: Production levels from major gas-producing regions (e.g., US, Russia, Qatar), storage levels, and infrastructure developments (pipelines, LNG terminals) significantly impact supply. Production levels from major gas-producing regions (e.g., US, Russia, Qatar), storage levels, and infrastructure developments (pipelines, LNG terminals) significantly impact supply. Geopolitical Events: Disruptions to pipeline flows or political tensions involving major gas suppliers can cause significant price volatility. Disruptions to pipeline flows or political tensions involving major gas suppliers can cause significant price volatility. Inventory Reports: Weekly inventory reports from major consumer nations (like the US) provide crucial insights into supply-demand balances and often trigger short-term price movements. Weekly inventory reports from major consumer nations (like the US) provide crucial insights into supply-demand balances and often trigger short-term price movements. Competition from Other Fuels: The price of natural gas can be influenced by the competitiveness of other energy sources, such as coal and crude oil. The price of natural gas can be influenced by the competitiveness of other energy sources, such as coal and crude oil. Appeal for Traders: Natural gas offers substantial price volatility, particularly due to seasonal demand and geopolitical factors. This creates frequent trading opportunities for those who can accurately assess market sentiment and supply-demand dynamics. 5. Copper: "Dr. Copper" - The Economic Barometer Copper, often affectionately dubbed "Dr. Copper" due to its uncanny ability to predict economic health, is a critical industrial metal. Its widespread use in electrical wiring, construction, manufacturing, and emerging green technologies (electric vehicles, renewable energy infrastructure) makes its demand a strong indicator of global economic activity. India's accelerating infrastructure development and manufacturing growth contribute to the active trading of copper. Market Dynamics and Price Influencers: Global Economic Growth: Copper demand is a fundamental building block of modern economies, and it directly correlates with global GDP growth, industrial output, and construction activity. Copper demand is a fundamental building block of modern economies, and it directly correlates with global GDP growth, industrial output, and construction activity. Infrastructure Spending: Government and private sector investments in infrastructure projects (roads, railways, power grids) drive significant copper demand. Government and private sector investments in infrastructure projects (roads, railways, power grids) drive significant copper demand. Urbanization and Industrialization: Rapid urbanization and industrialization in developing economies, particularly China (the most significant consumer), are major drivers of copper demand. Rapid urbanization and industrialization in developing economies, particularly China (the most significant consumer), are major drivers of copper demand. Green Energy Transition: The increasing adoption of electric vehicles, solar power, and wind energy, which are highly copper-intensive, represents a significant long-term demand driver. The increasing adoption of electric vehicles, solar power, and wind energy, which are highly copper-intensive, represents a significant long-term demand driver. Supply Disruptions: Mining disruptions due to labor strikes, natural disasters, or geopolitical issues in major producing countries (e.g., Chile, Peru) can impact supply and prices. Mining disruptions due to labor strikes, natural disasters, or geopolitical issues in major producing countries (e.g., Chile, Peru) can impact supply and prices. Inventory Levels: Global inventory levels of copper in warehouses provide crucial insights into the immediate supply-demand balance. Global inventory levels of copper in warehouses provide crucial insights into the immediate supply-demand balance. Appeal for Traders: Copper's strong correlation with global economic health makes it an attractive commodity for traders seeking to capitalize on broad economic trends. Its integral role in the green energy transition also provides a compelling long-term outlook for potential price appreciation. Conclusion: Navigating India's Vibrant Commodity Market The Indian commodity market offers a wealth of opportunities for astute traders and investors. Gold, Crude Oil, Silver, Natural Gas, and Copper consistently stand out as the most active commodities, each possessing unique drivers and trading characteristics. Futures contracts on established exchanges like MCX and NCDEX provide regulated and highly liquid avenues for participation, offering transparency and robust trading infrastructure. Thorough research, robust risk management strategies, and a comprehensive awareness of domestic and international market dynamics are essential for success in India's dynamic commodity trading arena.
