The government should continue the ban on futures trading of mustard to curb speculation and check hoarding by big players, said Vivek Puri, managing director of Puri Oil Mills. Besides, the prevailing situation makes it imperative for the Centre to formulate a National Mustard Policy, he said.
“The (continuation of) ban on futures is expected to curb speculation and check the hoarding mentality of certain big players. Such practices are known to cause severe price fluctuations, more so in a market that is already volatile. The decision to ban was also made with a view to cooling mustard prices and, to some extent it is successful,” Puri said in a statement.
The dissenting voice has come within days of an appeal made by Solvent Extractors’ Association of India (SEA) to restart futures trading. Stock and commodity market regulator SEBI had suspended various futures and options contracts in many agriculture commodities including mustard seed as a measure to check price rise in October 2021.
“But in the last three months, the prices have not come down and there is no impact of suspending futures trading to check the rising prices and has not helped in curbing the inflation. The very purpose of suspension of futures contract in mustard seed is not served,” SEA president Atul Chaturvedi said last week.
Puri said the unabated and unbridled increase in mustard oilseed prices throughout the year led to the steep rise in mustard oil prices, and compelled a large section of consumers to shift to imported edible oils that were available at lower rates.
Stressing that farmers as key stakeholders need to be the focus in the proposed policy, Puri said a National Mustard Policy would be an ideal way to nurture, safeguard and promote the legacy as this cooking oil has been a part of India’s culinary heritage. He also sought export of branded mustard oil in bulk be allowed, as current policy allows only in small packs.