MUMBAI, 1 September 2020: India’s leading agri commodity exchange, the National Commodity &Derivatives Exchange Limited (NCDEX), is ready to re-launch the Natural Whitish Sesame seeds (‘til’) futures contrac t, thereby, adding one more product to its oil seeds portfolio.
The Natural Whitish Sesame Seeds futures contract would be made available for trading from 26 August 2020 with Unjha (Gujarat) as the basis centre and Rajkot (Gujarat) as the additional delivery centre. The Whitish Sesame Seeds (til) futures contracts will be available for the expiry months of October 2020, November 2020 and December 2020.
Commenting on the launch, Vijay Kumar, MD & CEO, NCDEX, said, “NCDEX has always strived to introduce new business opportunities for farmers and value chain participants (VCPs). India is a major exporter of sesame seeds and holds huge potential in this space. The launch of this contract will provide an appropriate intervention to increasing the productivity of sesame seeds to boost farm profitability and widen the country’s export basket. The diversification of the oil seeds contracts will enable VCPs to foray into an additional asset for trading.”
India is the third largest producer of sesame seeds. As per FAOSTAT, India enjoys a global share of 12 percent of the sesame seeds trade. So, an absence of sesame seeds futures contracts globally would expose VCPs to the uncertainties in the commodity trade. The relaunch of NCDEX’s sesame seed futures contract could create a global benchmark for price indicators, not only domestic but also international participants.
According to the Department of Commerce, the export of sesame seed during April 2019 – March 2020 was 282,236 tons, valued at INR 3,723 crores. Additionally, according to the Ministry of Agriculture, the average market size of sesame in India in the last five years has been INR 7,280 crores. Madhya Pradesh and Chhattisgarh are the leading producers of sesame seeds, followed by Uttar Pradesh, Uttarakhand, Rajasthan and Gujarat, respectively. Collectively, these states produce more than 83 percent of the total sesame production in India.
Kapil Dev, Head of Business & Products, NCDEX, said, “The ever-growing health-food product market, backed with evolving consumer consumption patterns, has spurt a demand for sesame, which is rich in vitamins and minerals. We see a substantial scope for the product and are hopeful that sesame futures contract will help VCPs to discover a fair price in regulated and transparent market space.”
Sesame is a high-value commodity, with high volatility. It has an average annual volatility of around 40 percent mainly owing to demand and supply issues, crop failures and global market dimensions. The stakeholders in the sesame value chain which includes farmers, millers, traders and exporters are often exposed to price risks. With the availability of sesame seeds futures contract, VCPs will be in a betterposition to make informed decisions while trading.
