Commodities market regulator FMC has asked MCX and NCDEX to probe the volatility in guar futures prices and submit a report withing 15 days.
Prices of guar seed and guar gum for October delivery at the country’s two largest commodity bourses - MCX and NCDEX - have risen up to 85 per cent in the last one month.
At NCDEX, prices of guar seed for October delivery has increased by 85 per cent to Rs 7,720 per quintal on September 13 as compared with Rs 4,170 per quintal on August 13.
Prices of guar gum for October delivery rose by 81 per cent to Rs 21,490 per quintal on September 13 from Rs 11,860 per quintal on the same day in the previous month. A similar trend was seen in prices of guar seed and guar gum on the MCX platform as well.
FMC had allowed resumption of guar futures trade in May this year. In a directive, the Forward Markets Commission (FMC) said: “After the re-launch of the guar gum and guar seed contracts, it has been observed that there is high price volatility in recent times.”
The regulator has ordered MCX and NCDEX to conduct a “preliminary inquiry” and submit the report within 15 days on the price movement of the guar futures contracts.
FMC has sought observations of the surveillance team of the exchange on the price movement and suspect traders.
The two bourses have been asked to submit to regulator details of day-wise quantity traded and position held by top 25 clients from buy and sell side from June to August in guar futures.
They have also been asked to submit a copy of bank accounts and ‘know your client’ of top 25 clients to track the source of funds used for trading in guar futures.
The Foward Markets Commission (FMC) has directed MCX and NCDEX to collect details of physical stock owned by the clients who hold more than 75 per cent permitted position limit.
These bourses have been asked to inform their members that as and when the exchange requires, the client should disclose the source funds used in trading guar futures.