MCX to onboard farmers' collectives for futures trade

Benefiting Farmers

- SANDIP DAS

AFTER NCDEX, THE country's largest commodity derivatives exchange MCX has begun the process of onboarding farmer producer organisations (FPOs) to enable their participation in futures trading of agricultural commodities.

Sources told FE that during a recent webinar organised by the agriculture ministry, MCX expressed interest in bringing FPOs onto its platform.

According to an official, this move would help farmers plan sowing decisions well in advance based on future prices of the commodities.

"The platform offered by MCX helps efficient price discovery through competitive pricing, while delivery and payment are assured by the exchange," an official said, adding that the participation of FPOs in commodity exchanges also strengthens their collective ability to access credit from financial institutions.

MCX has decided to reimburse assaying charges, warehouse rent, storage, cost of bags, transportation, mark-to-market costs, broker fees, repository-related fees, mandi fees, etc. for the farmer collectives.