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NCDEX to relaunch robusta coffee futures

NCDEX to relaunch robusta coffee futures

Mumbai: The National Commodity and Derivatives Exchange Ltd (NCDEX) will relaunch futures trading in robusta coffee on 10 September, a senior exchange official said on Tuesday.

The contracts for arabica coffee would also be relaunched soon but the date has not been decided yet, the official, who did not wish to be named, added.

“We are coming up with a different grade of robusta," he said. “Earlier, it was robusta cherry clean bulk, now it will be robusta cherry AB."

Robusta cherry AB is the most exported coffee grade from India.

As a result, people were not getting enough reference from the robusta cherry clean bulk contracts and hence it became illiquid over a period of time, the official said.

Robusta, which is more tolerant to warm conditions than arabica coffee, comprises about 65% of India’s total coffee output, which is around 295,000 tonnes.

All grades of coffee will be benchmarked against robusta cherry AB, he said.

The grades higher than cherry AB will get a premium and the grades lower than cherry AB will get a discount on delivery to the exchange.

“We will have five contracts running in every alternate month," the official said. “The first contract will expire in January and the next contracts will be in March, May, July and September."

The contracts would be traded until 11:30pm. The unit of trading would be 2 tonnes. Earlier, it was 9 tonnes and then it was reduced to 1.5 tonnes to increase the participation of small traders.

The position limits would be 11,250 tonnes for members and 3,750 tonnes for clients. The daily fluctuation limit for the contracts will be 6%.

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