Indian markets have opened a new avenue for retail investors and traders to participate in a new financial instrument – “Commodity Derivatives”.
Trading in Commodities in India started long ago, but organized trading on the electronic platform has taken its pace with the establishment of three national level exchanges viz. NCDEX, MCX and NMCE. NCDEX commenced operation from December 15, 2003 while MCX was inaugurated in November 2003 by Shri Mukesh Ambani, Chairman & Managing Director, Reliance Industries Ltd. In India, now there are 25 recognized Futures exchanges of which there are three national level multi-commodity exchanges.
With the establishment of the three exchanges, trading volume has increased tremendously with the involvement of different communities like hedgers, arbitragers and speculators.
In the agro arena, NCDEX is busy counting its agri products like Pulses, Spices, Soy
bean and Refined Soy oil while MCX is busy with the International Commodities like Light Sweet Crude Oil, Gold and Silver.
India is a predominantly an agrarian economy and the world’s leading producer of 17 agricultural commodities with the world’s largest consumer of edible oils and gold.
As on 31st March, 2009 there are 6507 Indian wholesale markets & 20868 Rural Primary markets.