Ncdex eases quality norms for chana

Faced with tremendous delivery problems owing to quality levels not matching the stringent exchange specifications, the National Commodity & Derivatives Exchange (Ncdex) has eased the quality norms for the forthcoming chana contracts.

The contracts to be launched on December 11 for expiry in May and thereafter have been made more broad-based by striking off the region-specific origin of chana.

In the earlier specifications, chana was meant for Mumbai or Rajasthan or Madhya Pradesh. The regional specification has been removed, making it desi chana.

The biggest advantage of this change is to make the delivery of commodities easy, irrespective of their origin. According to the new contracts, Mumbai chana can be delivered in place of Rajasthan or Madhya Pradesh chana and vice versa.

The second important change that has been effected is the expansion in foreign origin. In the previous specifications, imported commodities were limited up to only 1 per cent of the total delivery.

This has been extended up to 3 per cent in the new specifications at a discount of 1:1.

In the new specifications, the varietal admixture (other mixture) will be permitted up to 3 per cent as against 1 per cent earlier.

On collecting samples from the market in the recent past, the Ncdex found that the commodity available in the spot market does not match with the quality specifications chalked out by the exchange.

As a result, open interest kept on mounting month after month, creating an acute shortage of quality goods.

The aim of the Ncdex is to bring goods deliverable on the futures closer to the spot market to make it more acceptable to traders, a source said.

"Liberalising quality specifications would surely boost the delivery, as traders were facing problems earlier. The change in quality specifications would not have any major impact on millers as such," a Jalgaon-based trader said.

A Mumbai-based trader was happy to note the changes by saying that the exchange is facing problems with the Madhya Pradesh-origin commodities. Now, sellers will reap more benefit with the new changes and traders will happily trade without being much tensed on quality issues, he added.

India will continue facing shortage of chana, which would be met through imports from Australia.

Once the imported pulse would be allowed for delivery, the stockists would also be able to import good quantity of chana for the comfortable release in the market, he added.