Prices of pulses like tur, urad, moong and yellow peas, are already down by 40% since their peak in 2009 and are likely to remain stable in coming months due to adequate stock and good production
Prices of pulses such as tur, urad, moong and yellow peas are expected to remain stable due to the adequate imports and expectation of good production in the coming rabi season. Experts say availability of fresh vegetables in the winter season also plays a key role in keeping prices of pulses under control.
Bimal Kothari, vice-president, India Pulses and Grain Association (IPGA), told Moneylife “According to our estimates the rabi crop should be fine. Generally, in the months of December and January there is decline in the demand for pulses due to availability of fresh vegetables. This helps in containing the prices of pulses.”
According to Mr Kothari, India, being the net importer of pulses, has so far imported around 1.5million tonnes of yellow peas, moong dal, tur, urad from countries like Canada, Australia, Myanmar and Africa.
Expert say that the above average rainfall, as compared to last year, is good for better rabi production as it helps improve the moisture levels of the soil. “We are expecting the pulses production for 2011-12 to be around 1.6 million tonnes,” says Mr Kothari.
According to the data from the ministry of agriculture, an area of about 4.50 million hectares has been under rabi pulses plantation, an increase from 3.68 million hectare as compared to last year, till first week of November.
In order to encourage farmers to take up pulses cultivation, the government has hiked the minimum support price (MSP) on chana and masur dal. MSP, for both the pulses, has been fixed at Rs2,800 a quintal, an increase of Rs700 per quintal for chana and Rs550 per quintal for masur as compared to last year’s prices.
Mr Kothari says, “I don’t see any reason for the prices to go up. They have actually been subdued by 40% compared to the prices of 2009, where it had reached to its peak. Overall, the pulses prices have negative contribution to the inflation. Expectation of good rabi production, higher MSP will balance the prices in favour of the consumers. The result is already seen in the wholesale market.”
“Though SEBI is yet to come up with a risk management system for high frequency trading, we want all the players to have their own risk management systems in place,” SEBI chairman UK Sinha told reporters
Mumbai: Capital markets regulator Securities and Exchange Board of India (SEBI) today ruled out banning high frequency trading or algo trading products even as it expressed concern over their faster growth and technical glitches they entail, reports PTI.
“We will consult all the stakeholders before taking a decision. Though SEBI is yet to come up with a risk management system for these products, we want all the players to have their own risk management systems in place,” SEBI chairman UK Sinha told reporters on the sidelines of a CII meet on capital markets here.
Observing that SEBI is not looking at banning these products, Mr Sinha said, “but, we are worried.”
Algorithmic trading or high frequency trading system uses highly advanced mathematical models to make transaction decisions. This highly quantitative trading model employs computerised algorithms to analyse incoming market data and implement proprietary trading strategies wherein large quantities of shares are purchased by dividing them into smaller lots and allowing the complex algorithms to decide when the smaller blocks are to be purchased.
Use of these products has been gone up significantly in domestic markets in the last three years.
Joining Mr Sinha, BSE managing director and chief executive Madhu Kannan said when he joined the premier exchange two-and-a-half-years ago, “only 5% trades on the BSE used to take place using algo products but this has now gone up to 25%”.
Following a technical glitch on the Muhurat trading on BSE, which led to cancellation of the entire derivatives trade on the exchange on Diwali day, SEBI had said it would do a thorough review of the risk management system in algorithmic trading to stop repetition of such incidents.
Addressing the Association of National Exchange Members of India last week, Mr Sinha had warned that the regulator would not allow anybody to mess with the system in the backdrop of some members being allegedly involved in manipulation.
“We have an effective risk management system, but we would not compromise. That is why we are ready to review,” he had added.
Mr Sinha had also hinted at that the proposed review would consider changes in the margin system and the capacity to take the trades. Accordingly, the secondary market advisory committee, at 11th its November meet, had discussed the matter.
On the introduction of new products, Mr Sinha said, “We are going to be very cautious about allowing new products, especially if we perceive they are going to be risky.”
He also added that the markets watchdog fully supports the products in the infra space like infra debt funds.
“Without infra growth we cannot have high growth,” Mr Sinha said.