(a) the details of commodity exchanges functioning in the country;
(b) the main features of eligibility criterion to become a member of these commodity
exchanges;
(c) whether such criterion facilitate the primary producers particularly the farmers to
become members and trade directly in such exchanges; and
(d) if not, how such exchanges benefit the primary producers and farmers?
THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION (PROF. K. V. THOMAS)
(a) The details of recognized commodity exchanges functioning in the country are as per
Annexure-I.
(b) The main features of the eligibility criteria to become a member of the commodity
exchanges, as provided in their Bye-laws arc as per Annexure-II.
(c)& (d): Yes, Madam. The primary producers are also eligible to become
members and trade directly in such exchanges if they fulfill the criteria prescribed by the
commodity exchanges. However, they can trade directly in such exchanges even as clients or
as members of co-operative societies or other entities who can become members or clients in
these exchanges.
Futures prices are discovered on the commodity exchanges through a transparent online
mechanism based on anticipated demand and supply conditions. Farmers and growers benefit
from these price signals emitted by the futures markets even though they may not directly
participate in the futures market. The futures markets lead to reduction in the amplitude
of seasonal price variation and help farmers realize a better price at the time of harvest.
This also helps farmers in planning their cultivation in advance as well as to determine
the kind of crop which they would prefer to grow, by taking advantage of the advance
information of the future price trends, and probable supply and demand of various
commodities in advance. Awareness programmes and capacity building programmes are
undertaken by the Forward Markets Commission and the Exchanges in order to educate
the fanners and other stakeholders of the benefits of price discovery and price risk
management functions of the futures market.