Guide to Commodity Exchanges in India
- 3 min read
A commodity exchange is an exchange where various commodities, agricultural and non-agricultural, tangible, or intangible, including their derivate products and other raw materials are traded. Most of the commodity markets across the world trade in products such as wheat, barley, sugar, maize, corn, cotton, coffee, milk products, pork, oil, metals, gold, silver etc.
Spots, futures, forwards and options are traded on commodity exchanges across the globe.
The commodity exchanges in India are regulated by the Securities and Exchange Board of India (SEBI) since 2015, which is also the regulatory authority for equity markets. Prior to this, the FMC or Forwards Market Commission, overseen by the Ministry of Consumer Affairs regulated the Indian commodity exchanges.
Get research-backed calls on commodity trading from PL’s industry-leading analysts. Open a demat account with PL to get started.
Below is a list of commodity exchanges in India and the products traded on these exchanges:
1) MCX: Multi Commodity Exchange
This is the largest commodities exchange in India, and it operates in over 40 countries. It is also the world’s largest exchange in silver and gold.
Established in November 2003
Headquartered in Mumbai
Promoters include the National Spot Exchange, IEX, Singapore Mercantile exchange, Global board of trade, IBS Forex, National Bulk Handling Corporation, Ticker Plant Ltd.
Traded Commodities:
Bullion, metals, fiber, energy, spices, plantations, pulses, petrochemicals, cereals among others
2) ICEX: Indian Commodity Exchange
It is a screen-based online derivatives exchange for commodities.
Established in November 2009
Headquartered in Gurgaon
Promoters include Reliance Exchange Next Ltd – an anchor investor, MMCTC Ltd, Indiabulls Financial Services Ltd, Indian Potash Ltd, and KRIBHCO among others.
Traded Commodities:
Gold, silver, diamond, copper, lead, crude oil, natural gas, mustard, soya bean, jute, iron ore.
3) NCDEX: National Commodity and Derivatives Exchange
It specialises mainly in agricultural commodities trading.
Established in December 2003
Headquartered in Mumbai
Promoters include NSE, ICICI Bank, LIC, NABARD, Canara Bank, Intercontinental Exchange, and Crisil among others.
Traded Commodities:
Cereals, pulses, fibers, oils & oil seeds, spices, gold, silver, steel, copper, crude oil, and brent crude oil among others.
Defunct Exchanges:
ACE: ACE Commodities and Derivatives Exchange
Promoted by the Kotak Mahindra Group, this commodity exchange declared itself facing problems of capital availability and low trading volumes. In May 2015, the exchange expired all existing contracts and discontinued all trading operations since then. As per regulations, since there has been no trading since then on the exchange, it exited the commodity and derivatives exchange business altogether.
UCX: Universal Commodity Exchange
This was India’s sixth national level commodity exchange which went live in 2012 but was shut down by the regulator in 2014 as a result of suspected fraud.
Newer Entrants:
The NSE or National Stock Exchange has also launched its commodity exchange on October 12, 2018. The exchange enables trading in energy, bullion, and base metals contracts.
The BSE, another stock exchange, also made its commodities debut on 1 October 2018. Traded commodities on the BSE include gold, silver, copper, and crude oil.
Trade and invest in commodities with confidence by relying on PL’s research-backed guidance. To get started, open a demat account with PL within minutes.
To know more about our comprehensive research across asset classes, click here.
Sandip Raichura
Executive Director, CEO Retail and Distribution
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
