A Study on Commodity Future of India (Draft - Bachelor Thesis on Price & Commodity Submitted to University of Kerala, Department of Commerce, Finance Wing)
GENERAL INTRODUCTION
Commodity:-
Commodity includes all kinds of goods. FCRA defines “goods” as “every kind of moveable property other than actionable claims, money and securities”. Futures trading are organized in such goods or commodities as are permitted by the central government. The national commodity exchanges have been recognized by the central government for organizing trading in all permissible commodities which include precious (gold & silver) and non-ferrous metals; cereals and pulses; oil seeds, raw jute and jute goods; sugar; potatoes and onions; coffee and tea; rubber and spices, etc.
The Indian experience in commodity futures market dates back to thousands of years. References to such markets in India appear in Kautialya’s ‘Arthasastra ‘. The words “teji”, “Mandi”,”Gali”, and “Phatak” have been commonly heard in Indian markets for centuries
The first organized future market was however established in 1875 under the aegis of the Bombay cotton trade association to trade in cotton contracts. Derivatives trading were then spread to oilseed jute and food grains. The derivative trading in India however did not have uninterrupted legal approval by the Second World War, i.e., between the 1920 & 1940’s. Futures trading in the organized form had commenced in a number of commodities such as – cotton, castor seeds, wheat, silver, gold etc. During Second World War futures trading is prohibited under defense rules.
After independence, the subject of future trading was placed in the union list, and forward contracts (regulation) act, 1952 was enacted. Futures trading in commodities particularly, cotton, oilseeds and bullion, was at its peak during this period. However, following the scarcity in various commodities futures trading in most commodities was prohibited in mid –sixties. There was a time when trading was permitted only two minor commodities, viz,, pepper and turmeric.
Commodities are more than what you
Commodity:-
Commodity includes all kinds of goods. FCRA defines “goods” as “every kind of moveable property other than actionable claims, money and securities”. Futures trading are organized in such goods or commodities as are permitted by the central government. The national commodity exchanges have been recognized by the central government for organizing trading in all permissible commodities which include precious (gold & silver) and non-ferrous metals; cereals and pulses; oil seeds, raw jute and jute goods; sugar; potatoes and onions; coffee and tea; rubber and spices, etc.
The Indian experience in commodity futures market dates back to thousands of years. References to such markets in India appear in Kautialya’s ‘Arthasastra ‘. The words “teji”, “Mandi”,”Gali”, and “Phatak” have been commonly heard in Indian markets for centuries
The first organized future market was however established in 1875 under the aegis of the Bombay cotton trade association to trade in cotton contracts. Derivatives trading were then spread to oilseed jute and food grains. The derivative trading in India however did not have uninterrupted legal approval by the Second World War, i.e., between the 1920 & 1940’s. Futures trading in the organized form had commenced in a number of commodities such as – cotton, castor seeds, wheat, silver, gold etc. During Second World War futures trading is prohibited under defense rules.
After independence, the subject of future trading was placed in the union list, and forward contracts (regulation) act, 1952 was enacted. Futures trading in commodities particularly, cotton, oilseeds and bullion, was at its peak during this period. However, following the scarcity in various commodities futures trading in most commodities was prohibited in mid –sixties. There was a time when trading was permitted only two minor commodities, viz,, pepper and turmeric.
Commodities are more than what you