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Gujarat farmers ask FMC to ban castor seed futures

Following high volatility in the last few weeks, farmers in Gujarat have asked commodity derivatives market regulator Forward Markets Commission (FMC) to ban futures trading in castor seed.

In a Tuesday letter to the FMC, the Bhartiya Kisan Sangh (BKS), a farmers’ representative body, has urged that futures trading in castor seed be banned in case excessive speculative activities are witnessed on commodity exchanges.

Alleging that FMC’s imposition of margins when prices move up benefits multinational companies, the BKS wrote: “Let the market factors of supply–demand determine the fair prices of the castor as farmers would then be free from the clutches of the monopolistic local manufacturers.”

Average castor seed price jumped 17.83% in October 2014 to Rs 44,000 a tonne in Gujarat spot mandi as compared to Rs 37,553 a tonne in November last year. During the week to November 28, however, castor seed price declined 3.28% to Rs 44250 a tonne.

Castor seed’s share in overall turnover of NCDEX at Rs 66198 crore has shot up to 26.60% in October from 23.5% share in Rs 83520 crore turnover recorded in September. The oilseed’s contribution, however, has fallen to 20.80% in the exchange turnover of Rs 49008 crore up to November 24.

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