The Forward Markets Commission (FMC) has demanded to institutionalize the commodity markets in order to make sure equal participation of physical market as well as large business players.

At a seminar organised by the Multi Commodity Exchange (MCX) on Tuesday, B C Khatua, chairman of FMC said, “While over the last four years' the commodity exchanges have grown 30 times in size, trade volumes and participation is particularly high in some commodities.”

Mr. Khatua said that the comfort level of the physical markets was one of the main reasons that a few major commodities did not achieve much in such markets.

When market players expected lack of lucidity in the futures market, and in this situation few players drive the whole market.

“We are working for reaching out large masses, but it is not an easy job to do,” Mr. Khatua said.

He also said, Indian markets were no more quarantined to the worldwide markets, and the agriculturists required to stay informed in order to have a profitable crop. This was achievable through commodity exchanges.

He also said that if the wastage in commodities could be reduced, both consumers and farmers would gain and in contrast the mediators’ profit would shrink.

While lecturing at the occasion, Joseph Massey, deputy managing director of MCX, said, “Some products in the commodity exchanges are missing due to enabling mechanisms, but for other there are not enough participants to take the risks of big corporates. It will take some time to transfer the risks , possibly to cluster of small participants.”

Recently Mr. Khatua met cooperative bodies, banking institutions and NGOs to ease the participation of farmers in the exchanges.

Afterward, in his conference with the interpreters of commodity exchanges, Khatua said different aggregation models, with or without financial backing from banks, might be navigated in the market place through the exchanges to aid farmers involvement in the futures market.

Simplicity in customer dealings and quick settlement of conflicts with customers would support sustainable growth in volume as well as clientele.