The National Spot Exchange Ltd (NSEL), the pan-India electronic spot market for commodities, is planning to launch metal contracts in aluminium, nickel, platinum, steel among others as part of its e-series spot contracts by April, 2010.
The spot exchange, promoted by Financial Technologies and Nafed, will also launch agri-commodities under the e-series during the calender year.
“After the encouraging response to our e-series products, we plan to launch base metals under the e-contract in the next three-four months,” Anjani Sinha, managing director and chief executive officer, National Spot Exchange Ltd, said.
Presently, NSEL has four contracts namely e-gold, e-silver, e-zinc and e-copper under the present e-series with a combined turnover of Rs 700 crore -Rs 800 crore on daily basis. The spot exchange is also planning to come up with e-series contracts for different agri-commodities.
“Agri-commodities like chana, guar gum, mentha oil, black pepper will be the first products to be launched under e-contracts,” he said.
He also said price discovery on a spot exchange was more than a future exchange.
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E-series contracts enables retail investors to buy or sell commodities in small amounts through brokerage firms which allow commodity trading.
Referring to the turnover in 2011, Sinha said the exchange was expecting a turnover of Rs 2,000 crore per day after all e-series contracts started trading.
He, however, said this spot exchange would not cannibalise clients from its parent-owned future exchange, MCX in future.
“There was no conflict and we don’t expect clients from MCX or any other future exchange migrating to our spot exchange. This is a new market space with a different type of investors,” he said.
The spot exchange is also selling various agri-commodities through tie-up with agriculture co-operatives like NAFED and cooperatives from Andhra Pradesh, Punjab, Haryana , Karnataka among others.
The exchange is also selling imported pulses of MMTC in the spot market.
“We are presently in talks to sell pig irons through collaboration with MMTC and will start the process in next three months,” Sinha said.
National Spot Exchange will also launch e-gold exchange programme for jewelery. “Under this initiative, investors will be able to exchange e-gold units for jewellery from our empaneled jewellers in the near future,” he said.