1 / 13

Oil & Oilseeds @ NCDEX

Oil & Oilseeds @ NCDEX. Benchmark for the industry GlobeOil 2013. Agenda. Pre and post futures market scenario Hedging Contract Performances New Initiatives. Story a decade back……. Lack of transparent Price discovery Mechanism.

kishi
Download Presentation

Oil & Oilseeds @ NCDEX

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Oil & Oilseeds @ NCDEX Benchmark for the industry GlobeOil 2013

  2. Agenda • Pre and post futures market scenario • Hedging • Contract Performances • New Initiatives

  3. Story a decade back…… • Lack of transparent Price discovery Mechanism. • Industry did not have any relevant hedge available, so they had to keep the risk on themselves. • Unregulated Forward contracts and hence there was always risk of counter-party defaults. • Also liquidity in forward contracts was limited. • Lack of far month price discovery. • In-efficient working capital deployment by the Industry.

  4. Post Futures Market • Provision of reliable price discovery • Stringent regulatory environment, hence ensuring honoring and smooth settlements of contracts • Bringing transparency & liquidity in trade • Importers could book a sales against their Imports that too in Rupee terms • Industry could make forward commitments reducing the working capital requirement and ensuring a optimum capacity utilization • It became very easy and handy for small traders and other small participants to hedge or trade into futures market • Better price discovery in the far months • The basis risk gets reduced significantly due to high correlation with international markets

  5. Hedging – Recognized in Finance Bill 2013 • Union Budget 2013-14 • Allowed clubbing of the commodity derivatives transaction’s income with the Business transaction’s income. • Futures transactions would not be treated as ‘speculative transaction’.

  6. Oilseeds Complex - NCDEX • Soybean • Rapeseed-Mustard • Castor seed Oilseeds • Refined Soy oil • RBD Palmolein Edible Oils • Cotton seed oilcake • Soymeal Oilcakes/Meal

  7. Growth at NCDEX

  8. Open Interest Volume Vs Market Size Source: NCDEX,CME As you can see above the Indian futures market have relatively very low depth compared to its international peers. In Soybean Oil in CME the Open Interest as a percentage of actual market is 85% compared to India it is just a mere 8%.

  9. Initiatives • EFP • Bulk Storages • COMTRACK + Direct Delivery

  10. EFP process flow

  11. Advantages of EFP • Enables risk management using NCDEX Futures • Delivery between the specific firms at mutually agreed quality, location and premiums. • Prevents slippage loss; if each party closes position independently

  12. Bulk Storage • Instead of horizontal storage use of vertical storages • Storage without gunny bags • Solve the problem of space • Handling would be easy • In line with the practices followed by major industries

  13. Thank You CONTACT: Customer Service Group: : 02266406789 : askus@ncdex.com

More Related