NCDEX Launches a Multi-State Campaign to Create Awareness Around Commodity Derivatives Markets

Underlining the high level of ignorance, misinformation, and misconceptions around the commodity derivatives, National Commodity and Derivatives Exchange Ltd. (NCDEX) in Mumbai launched a week-long nationwide awareness campaign that will focus on creating awareness and promoting progressive financial and trade practices.

The campaign is part of the Sixth Annual World Investor Week-2022 (WIW) that started on Oct 10 under the guidance of the capital market regulator Securities and Exchanges Board of India (SEBI).

The campaign was kicked off by launching a Krishi Rath in Mumbai, which was flagged off by SEBI Wholetime Member, Ashwani Bhatia in the presence of ED, SEBI, GP Garg, FPO leaders, and other dignitaries from SEBI. Nine more Krishi Raths were simultaneously flagged off from as many key locations in five states, i.e., Rajasthan, Maharashtra, Gujarat, Madhya Pradesh, and Telangana to cover around 33 APMC market yards and villages en route. Krishi Rath is a mobile van where exchange officials will communicate and collaborate with regional or local government functionaries, local leaders, FPOs, and other stakeholders to spread awareness about the importance of risk management through commodity derivatives.

Ashwani Bhatia, Wholetime Director, SEBI talked about diverse product offerings to be launched which are simple to understand by various stakeholders. He also drew a synergy between the deepening of the commodities market through the FPOs and safer lending by banks to these hedged products.

“At NCDEX, it has been our constant endeavor to serve the interests of the primary producers, i.e our farmer’s partners and the entire commodities value chain, with better market access, efficient price discovery tools, and financial inclusion. In that direction, we take this campaign as an opportunity to enhance our investor’s awareness program and sensitize our stakeholders about diverse opportunities they could explore in the commodity derivatives market, besides, guiding them with effective financial and trade practices,” said Arun Raste, MD & CEO of the exchange.

The Exchange will also launch the NCDEX IPFT Investor Protection League (IPL) to honor members who are spearheading best practices and innovations in customer service to withhold the confidence of clients in the commodity derivatives market.

‘Hack The Risk’, a pan-India industry-academia event, which evoked encouraging responses among youths last year, will also be presented offering the opportunity for college students to express their perspective on the importance of risk management. Additionally, NCDEX IPFT has successfully launched the Commodity Connect Program for undergraduate students at Wilson College. Through this event, the students were introduced to the concept of commodity as an asset class, the world of commodity derivatives, and the essential skills required for commodity knowledge for young minds.

All the initiatives being undertaken by the Exchange across the length and breadth of the country will focus on sharing knowledge and awareness about the commodity market among the diverse nature stakeholders about various risks they are exposed to. Since all risks, e.g., weather risk, product risk, policy risk, etc, reflect in the price of the commodity, exchanges can play a big role in providing a one-stop solution for hedging the price risk via futures, options, and indices.