Sebi Gets Reports on Agri Commodity Delivery Rules
Why in the news
Working groups formed to review how delivery and settlement work in agricultural commodity markets have handed their reports to the Securities and Exchange Board of India (Sebi), which can now consider regulatory action.
Key facts
- The groups were created to re-examine delivery and settlement mechanisms in agri commodity derivatives trading.
- Their reports are now with Sebi for follow-up.
Types of commodity derivatives
| Type | Underlying | Main users |
|---|---|---|
| Agri commodity derivatives | Agricultural products (futures and options) | Farmers, traders, processors and agri-businesses hedging price risk |
| Non-agri commodity derivatives | Metals, energy, bullion and other non-farm goods | Industrial users, refiners, exporters and financial participants |
Exam angle
- Regulator involved: Sebi.
- Subject of review: delivery and settlement framework.
- Purpose of agri derivatives: hedging price risk.