MCX optimistic about future trading in UP

Multi Commodity Exchange of India (MCX), an independent and demutualised commodity exchange to facilitate online trading, clearing and settlement operations for commodity futures market across the country, is optimistic about commodity future trading in Uttar Pradesh in coming years.

"Besides potato and mentha, which are extensively produced in the state and tops the trading charts, gold and silver are the metals to look forward to, as the state offers a great business in them," Sumesh Parasrampuria, chief business officer, MCX, told Business Standard. MCX at present has 36 members and 600 terminals in the state.

"The highest delivery of any commodity ever was recorded in this season for mentha, which was about 6,000 tonnes, from the state," added Parasrampuria.

Total mentha oil output is pegged at about 18,000-20,000 MT, at present. Almost 80-90 per cent of the total area under mentha cultivation is in Uttar Pradesh, followed by Bihar, Punjab, Haryana and Himachal Pradesh. Production for the current year is expected to be 33,000 tonnes, up by 32-35 per cent. The company has a tie up with the Indian Institute of Management, Lucknow for research purposes. The institute carried out a survey for potato and mentha cultivation in the state last year.

"Agra is a leading producer of potato while Chandausi and Rampur produces mentha. The survey discussed how the sowing and acreage has increased over past few years in these two commodities. Also how it is beneficial for the farmers to grow these products," added Parasrampuria. Rs 15,000 crores is the total exchange market in the country, of which about 7 per cent is the share of the state.

"This share can still be increased. It is important to educate farmers that future trading helps to know the expected worth of their commodities in the months to come. This helps them to store their goods in warehouses and sell these at the right time," Parasrampuria said.

Creating awareness about future trading, MCX in association with Karvy Comtrade Ltd, a Karvy group company, along with ZEE Business conducted an investors' camp in the state to educate investors about growing importance of India's commodity markets.

"The state has huge scope for future trading especially in commodities like gold, silver, potato, sugar and mentha oil," said Ashok Mittal, vice president and country head of Karvy Comtrade Ltd.

Karvy Comtrade has about 76 branches in the state, of which 67 are doing commodity trading.