Mumbai, Nov 26 (UNI) The National Commodity and Derivative Exchange Ltd (NCDEX), the country's leading agriculture commodity exchange, has decided to launch futures contract in the Shankar Kapas variety of cotton on November 29.
An across-the-board demand from growers, processors, exporters and traders has encouraged the exchange to plan introduction of futures contract in this cotton variety.
In a statement here today, NCDEX's Chief Business Officer Shrikant Subbarayan said ''Our existing Kapas contract has been well received by the trade. We took a cue from this and jointly explored the feasibility of introducing futures contract in Shankar Kapas with value chain participants,'' The trade has given a positive feedback on this initiative. With the cotton season in full swing, this is the appropriate time to roll out the new contract, Subbarayan added.
Shankar Kapas is the benchmark cotton grown in India and is the most consumed and exported variety. As Kapas is processed down the value chain, raw material hedging becomes important as the margins tend to get range-bound.
Shankar Kapas recorded a total production of over 90 lakh bales in the 2006-07 crop season.
This year, the production estimates for this variety is about 115 lakh bales, valued at around Rs 11,000 crore.