NCDEX Launches Options on Turmeric, Coriander, and Jeera Futures

The National Commodity and Derivatives Exchange Ltd. (NCDEX) announced the launch of options contracts on turmeric, coriander, and jeera futures, starting January 2, 2025. This move aims to enhance market participation and provide stakeholders with effective risk management tools in the spices market.  

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NCDEX’s New Contracts  

In a circular issued Thursday, NCDEX outlined the specifics of the options contracts. The contracts will initially cover futures expiring in different months:  
- Turmeric and Coriander: Expiring in April, May, and June.  
- Jeera: Expiring in March, April, and May.  

Key specifications include:

- Turmeric: Trading unit is 5 tonnes, maximum order size 250 tonnes, and tick size INR 1 per 100 kg.  

- Jeera: Trading unit is 3 tonnes, maximum order size 150 tonnes, and tick size INR 2 per 100 kg.  

- Coriander: Trading unit is 5 tonnes, maximum order size 500 tonnes, and tick size INR 1 per 100 kg.  

These options will follow the European style and, upon expiry, any outstanding open positions will convert into the respective futures contracts. NCDEX will charge a flat transaction fee of INR 30 per INR 100,000 turnover on premium value, effective January 2.  

Rabi Sowing Update in Rajasthan

Meanwhile, Rajasthan's agriculture department reported increased rabi crop sowing, with total acreage reaching 10.68 million hectares, a 2% rise compared to the same period last year.  

- Wheat: Acreage rose 12.7% to 2.99 million hectares, compared to 2.66 million hectares a year ago.  

- Barley: Declined to 406,350 hectares from 430,310 hectares.  

- Pulses: Increased to 2.01 million hectares from 1.94 million hectares, led by chana, which saw a rise to 1.97 million

hectares.  

- Oilseeds: Declined to 3.39 million hectares from 3.74 million hectares, primarily due to a drop in rapeseed and mustard sowing, which fell to 3.29 million hectares.  

The rabi season, which begins post-monsoon, includes key crops like wheat, barley, gram, and oilseeds such as rapeseed and mustard. The state has achieved 89% of its 12 million-hectare target for rabi sowing this season.  

Conclusion

NCDEX’s introduction of options contracts on spices is expected to provide farmers and traders with a robust hedging mechanism while increasing market liquidity. Concurrently, Rajasthan’s promising rabi sowing data signals strong agricultural output, barring oilseed declines. These developments highlight the evolving dynamics in India’s agricultural and commodity markets.