The fast-spreading COVID-19 has halted the economic activity and battered the stock market, but prices of essential commodities in the futures market are on the rise.
Industry observers say the bull run in commodity exchanges, running on a thin volume with hardly any underlying physical transaction in mandies, is driven by speculators looking to make quick bucks.
Data for the prices of essential commodities for the last 10-15 days shows a rising trend. Soybean seed prices increased by Rs 5,700/MT, Chana prices by Rs 3,650/MT and Refined Soy Oil prices rose by Rs 13,520/MT during the said period.
Incidentally, the erstwhile FMC (Forward Market Commission) had stated that the efficient functioning of the commodity futures market warrants active participation of physical market stakeholders. It was expected that the futures market will 'serve as a meaningful and effective platform for price discovery and price risk management and provide significant economic inputs to the physical market players, especially farmers, to support their production and marketing related decision making process'.
Price trends in essential commodities in futures market during last 10-15 days period: