BRINGING EFFICIENCY IN AGRI-COMMODITIES MARKET
SAMIR SHAH
MD & CEO
CHALLENGES TO PULSES ECONOMY
………………………………………………………………..
Price
Volatility
Counterparty
Risks
Storage
Limitation
Challenges /
Risks
Raw
Material
Availability
Working
Capital
Market
Access and
Remunerative
Price to
Farmers
Pragati Ka Solid Exchange
2
SOLUTIONS IN FUTURES
………………………………………………………………..
PULSES PRICES FOLLOW CYCLICAL PATTERN
………………………………………………………………..
Pragati Ka Solid Exchange
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CHANA : LEAST VOLATILE AMONGST ALL PULSES
………………………………………………………………..
NCDEX SPOT PRICES
12,000
10,000
8,000
6,000
4,000
2,000
Chana - NCDEX
Pragati Ka Solid Exchange
Tur - NCDEX
Urad - NCDEX
Moong - AGMARK
Aug-15
Jun-15
Apr-15
Feb-15
Dec-14
Oct-14
Aug-14
Jun-14
Apr-14
Feb-14
Dec-13
Oct-13
Aug-13
Jun-13
Apr-13
Feb-13
Dec-12
Oct-12
Aug-12
Jun-12
Apr-12
Feb-12
Dec-11
Oct-11
Aug-11
Jun-11
Apr-11
Feb-11
Dec-10
Oct-10
Aug-10
Jun-10
Apr-10
0
Masoor - NCDEX
5
HEDGING PRICE RISK
………………………………………………………………..
DELIVERIES OF CHANA ON NCDEX
PLATFORM
PERCENTAGE OF NEAR MONTH AVG. OI CONVERTING INTO
DELIVERY
90000
90.0%
80000
80.0%
Deliveries (MT)
70.0%
60.0%
50.0%
40.0%
30.0%
70000
60000
50000
40000
20.0%
30000
10.0%
0.0%
20000
Jan
Feb
Mar
Apr
May
2013
Source: NCDEX
June
July
2014
Aug
2015
Sep
Oct
Nov
Dec
10000
0
2013
Pragati Ka Solid Exchange
2014
2015
6
ACCESS TO WORKING CAPITAL
………………………………………………………………..
FUNDING THROUGH COMTRACK
(IN CRORES)
700
600
Loan Value
500
400
300
200
100
0
2013-14
2014-15
2015-16
Financial Year
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SOLUTIONS IN FORWARDS
………………………………………………………………..
ACCESS TO NATIONAL MARKETS
………………………………………………………………..
FORWARDS TRADE (QUANTITY IN %)
Jeera
4%
Guar Seed
1%
R M Seed
1%
Coriander
11%
Castor Seed
28%
Castor Seed
Sugar
8%
Around 28000 MT of
Maize
Chana
commodities traded
Sugar
(approx. Rs. 120 crore).
Coriander
Jeera
Guar Seed
Chana
19%
R M Seed
Maize
28%
Pragati Ka Solid Exchange
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TRANSPARENT BUFFER STOCK MANAGEMENT via EXCHANGE
………………………………………………………………..
Goal: Involve Private trade in a transparent stock management process
Process:
• Set buffer stock targets and permit licensed stockists to participate with exemption
from stock limits.
• Trader can procure domestically or via imports recording procurement prices and
incidental costs.
• Government can notify agencies for retail sale, announce price and quantity for
retail sale.
• Liquidation through transparent, controlled price auction.
• Buyer will process and package stock for sale at Government determined MRP.
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SOLUTIONS THROUGH PRIMARY MARKET DEVELOPMENT
………………………………………………………………..
MANDI MODERNIZATION – Roadmap to Modern Mandi
………………………………………………………………..
CREATED A WIN-WIN FOR ALL
Pragati Ka Solid Exchange
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NCDEX : ADDING ECONOMIC VALUE TO ALL
………………………………………………………………..
C : Challenges to market /market participants
VA : Value addition NCDEX has brought to the
ecosystem
C : Price Volatility
VA : Hedging Price Risk in Futures,
for all Value Chain Participants
C : Storage Limitation
VA : Increased Number of
Warehouses and Capacity over
the Years
C : Counterparty Risks
VA : Forwards, Hedging
Futures
Challenges / Risks
C : Raw Material Availability
at selected location
VA : Forwards
C : Working Capital requirement
VA : Comtrack and ePledge –
Less Risk – Higher Funding
C: Market Access, Remunerative Prices to Farmers
VA : UMP, Mandi Modernization,
Futures, Forwards
Pragati Ka Solid Exchange
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