The National Spot Exchange commenced trading on Wednesday to provide farmers across the country

RELATED ARTICLES Gold demand to slow as disposable income drops: WGC Gold falls to 4-1/2 month low on Greece risks Gold suffers biggest loss in a month on Greece concern In domestic market, gold gets free of global trend Firm prices see gold traders stay on sidelines

with a single trading platform. National Spot Exchange , which went live on October 15, will try and address all these issues. In an interview with Preeti Mishra, Anjani Sinha, managing director and CEO, National Spot Exchange, discusses features of the new exchange. Excerpts:

Why will the farmer want to participate in the exchange, especially when there are two platforms already available?

For one the farmer can expect to get at least 30-35 per cent better price realization. Another thing is the smaller contract sizes, which would allow even the small farmer to participate. Our contract sizes are10 metric tonnes for traders and one quintal for the farmer. And given the clearance that we have received we expect to commence trading in agro-commodities like castor seeds, jeera, cotton, toor dal, red arecanut and cardamom. As of now, cotton, gold and silver are the commodities trading on the exchange. Farmers and traders will not have to worry about warehousing facilities either due to our partnership with the NBHC (National Bulk Handling Corporation), which will provide these at relevant regions across the country. In any case, we will not be trading in perishable commodities. SAFAL National exchange provides the spot market for perishable produce, while we will deal with semi-perishable and non-perishable items.

Will the platform be available to farmers across the country?

Presently, we have received clearance to start in Gujarat, Karnataka and Maharasthra. Later, we are also looking to commence trading in Kerala and Bihar, and this would also explain the reason for the choice of commodities to be traded on the exchange. Trading hours are conducive allowing stakeholders across the agricultural chain to participate, this is especially true for farmers as the exchange would operate from 10 am to 5 pm.

Has the response for the mock trading sessions been favourable?

We commenced mock trading in August this year. In this nearly 250 traders participated, and about 550 members took part in total including the sub-brokers. On the corporate side exchange participants include Glencore, Britannia, Pulses Importers' Association, Farmers Co-operatives in Kerala and Gujarat, which includes e-Sewa and Gujarat Agro-Industries' Corporation. Going forward, we expect to pick up trading volumes, and anticipate generating at least Rs 400-500 crores on a per day transaction basis. And this is across all commodities on offer.

Besides agro-produce, is the National Spot Exchange going to offer a trading platform for other commodities?

We are offering gold and silver contracts, with Ahmedabad as the delivery centre. The gold guinea contract will be available in 1 kg and 100 grammes, while silver is a 30 kg contract. We might contemplate offering contracts in fertilisers and pesticides but this is entirely dependent on the government.