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Awareness Programmes on Hedging Organised by MCX



mcxMulti Commodity Exchange of India Ltd (MCX), organised awareness programmes on commodity futures at Lohardaga, and Gumla on May 05, 2015, and May 06, 2015 respectively. The programmes organized for members of Lohardaga Chamber of Commerce, Lohardaga Gold Association, and Gumla Chamber of Commerce, most of whom were jewellers, focused on the benefits of hedging and price discovery mechanism.

Jewellery business is exposed to price risk of precious metal market on regular basis; the commodity exchange platform can be used to mitigate the same by locking in the future prices. Commodity exchanges such as MCX provide a transparent price discovery and hedging platform for trading futures contract of different commodities. On these exchanges, the fair-value prices are determined through active participation of a large number of stakeholders of the commodity value chain, who have access to information on the demand and supply conditions. This informative seminar was used to build their confidence in futures market participation.

The experts from MCX explained in detail about the commodity futures market, which is a well-accepted and widely participated institutional innovation to help stake holders discover future prices and to better manage risks to their businesses or economic well-being arising out of commodity price movements.

Mr. Abhay Agarwal, President, Lohardaga Chamber of Commerce said, “Since the last few years, high volatility in the commodity prices has increased the risks, which need to be addressed to protect profitability margins of the commodity value chain participants. We are glad to be associated with MCX in organising this programme as it is necessary to create awareness amongst the stakeholders of commodity ecosystem on the need to hedge their price exposures.”

Mr. Sanjay Burman, Secretary, Lohardaga Gold Association said, “The seminar organized by MCX for our members was very productive and informative. It gave us in-depth information about hedging our bullion price exposures against price volatility and the method of physical delivery. I thank MCX for taking this initiative of guiding us.”

Mr. Anup Kumar Singh, Secretary, Gumla Chamber of Commerce said, “This seminar was extremely interactive and edifying. Such programmes on commodity futures trading encourage more and more participants from the varied industries and sectors to use the commodity futures market for price discovery and managing their price risks. We look forward to many such seminars in the near future.”