SEBI plans cash settlement for maize groundnut chili trades
SEBI (India's market regulator) is planning to let some agricultural commodity trades settle in cash instead of just physical delivery.
The idea is to help boost trading in crops like maize, groundnut, and chili, especially since strict rules and low participation have made these markets pretty quiet lately.
Contracts could start as cash-settled and switch to physical delivery later if things pick up.
Mandatory delivery rules cut trading volumes
Right now, mandatory physical settlement and restrictions on futures trading for key crops have kept volumes low and even led to some contracts being dropped.
SEBI's new plan, backed by its Commodity Derivatives Advisory Committee, hopes to bring more people back into agricultural trading and revive interest in these essential markets.
If the pilot works out, it could mean a lot more action for India's agricultural derivatives scene.