| In May 2007, the Centre banned wheat futures trading after prices surged in the open market when production turned out to be lower than expected. Output then was 75.81 million tonnes against initial projections of about 80 million tonnes. The lower production also led to procurement by Government agencies for buffer stocks plunging to 11.12 million tonnes (mt).
Prices then rose to ?1,000 a quintal in the open market, forcing the Centre to blame the increase on the futures trading and subsequently ban it. The then National Commodities and Derivatives Exchange chief PH Ravishankar said that the rise was not surprising since the futures market had been pointing to such a trend from 2006-end...............................................Full Article: Source |