rapeseed oil

Mustard Oil Mills Request Resumption of Futures: MOPA

Mintec Global
Spread the news!

Ahead of the Rabi sowing season, the country’s mustard oil processors have sought a review of the Government’s decision on the ban on futures trading of oil seeds and edible oils as this is the right time to send farmers the price signal so that they are encouraged to stick to the oil-seed crop and do not shift to other alternative crops.

“We have written to market regulator SEBI requesting for re-launch of the contracts in oil seeds as the permission to commodity exchange NCDEX has not been given to start any new contract in either oil seeds or edible oils,” said Babu Lal Data, President of Mustard Oil Producers Association of India (MOPA). The price signal to farmers is very crucial since wheat prices are high and pulses acreage in the Kharif season is lower than year-ago.

Futures trading

The Association has said that 11 months have passed after the ‘surprise’ decision to prohibit futures trading of edible oils and oilseeds, the SEBI should take an appropriate decision in the interest of farmers, consumers, and market participants by analyzing its impact since October 2021. In the absence of any futures, processors, and importers were not able to hedge their price risk in the last year during which global prices witnessed huge volatility.

Citing the price rise in edible oils after the ban, MOPA said that it was more due to dependence on imports and clearly proved that there was no direct linkage with futures trading.

Source: The Hindu business Line