New Delhi, May 27 (PTI) National Stock Exchange on Wednesday signed a memorandum of understanding (MoU) with the Steel Users Federation of India to jointly develop the steel and commodity derivatives ecosystem.
The partnership aims to create a transparent and efficient price-risk management framework for the Indian steel industry participants, enabling them to hedge price volatility through exchange-traded derivatives, National Stock Exchange of India Ltd (NSE) said in a statement.
The initiative is expected to benefit a wide range of stakeholders, including steel manufacturers, processors, MSMEs, OEMs, infrastructure companies, end-users, etc, it added.
As part of the agreement, NSE and Steel Users Federation of India (SUFI) will work closely on product design, market outreach, industry consultations, capacity building and awareness initiatives to facilitate the successful development of steel and any other relevant commodity derivatives products in India.
India is among the world's largest producers and consumers of steel, with the commodity widely used across sectors, such as automobiles, engineering, infrastructure, capital goods and consumer durables.
The proposed contract is expected to provide an effective hedging mechanism and support improved price discovery for the domestic steel value chain participants.
Sriram Krishnan, Chief Business Development Officer, NSE, said: "Our collaboration with SUFI is an important step towards building credible and liquid derivatives contracts that address the hedging requirements of the Indian steel market participants".
The MoU reflects the shared commitment of NSE and SUFI towards fostering a modern and globally competitive commodity derivatives market in India, he added.
The partnership aims to create a transparent and efficient price-risk management framework for the Indian steel industry participants, enabling them to hedge price volatility through exchange-traded derivatives, National Stock Exchange of India Ltd (NSE) said in a statement.
The initiative is expected to benefit a wide range of stakeholders, including steel manufacturers, processors, MSMEs, OEMs, infrastructure companies, end-users, etc, it added.
As part of the agreement, NSE and Steel Users Federation of India (SUFI) will work closely on product design, market outreach, industry consultations, capacity building and awareness initiatives to facilitate the successful development of steel and any other relevant commodity derivatives products in India.
India is among the world's largest producers and consumers of steel, with the commodity widely used across sectors, such as automobiles, engineering, infrastructure, capital goods and consumer durables.
The proposed contract is expected to provide an effective hedging mechanism and support improved price discovery for the domestic steel value chain participants.
Sriram Krishnan, Chief Business Development Officer, NSE, said: "Our collaboration with SUFI is an important step towards building credible and liquid derivatives contracts that address the hedging requirements of the Indian steel market participants".
The MoU reflects the shared commitment of NSE and SUFI towards fostering a modern and globally competitive commodity derivatives market in India, he added.
(This story has not been edited by THE WEEK and is auto-generated from PTI)
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