The National Stock Exchange, which will make its debut in commodity derivatives trading on Friday, has signed a licensing agreement with the London Metal Exchange for using its prices to settle contracts.
The licensing agreement will permit NSE and NSE International Financial Service Centre to use the prices derived on LME, the world leader in non-ferrous metal futures, to settle various commodity futures contracts, subject to receiving regulatory approvals.
Vikram Limaye, Managing Director, NSE, said the licensing agreement with LME affirms the exchange’s commitment to deepen the Indian commodity markets by providing convenient and cost-efficient onshore hedging mechanism for domestic and global participants.
BSE-Dubai bourse
Meanwhile, BSE has signed a pact with Dubai Mercantile Exchange, international energy futures and commodities exchange in West Asia, to explore ways in maximising the potential of the commodities market in India. BSE launched commodities derivatives trading platform on October 1.
The exchange said the strategic collaboration with the energy-focused commodities exchange will help create a resourceful commodities derivatives market to facilitate growth in the country’s energy sector.
This synergy will help Indian corporates to hedge their exposure on BSE’s commodities derivatives segment. Ashishkumar Chauhan, Managing Director, BSE, said the tie-up with DME will help all the stakeholders.
Launched in June 2007, DME lists Oman Crude Oil Futures Contract as its flagship contract, providing the fair and transparent crude oil benchmark for the region.
DME Oman is the sole benchmark for Oman and Dubai crude oil.