Exclusive: ICEX to shut commodity operations; BSE, MCX to be biggest gainers
Of all the the commodity exchanges in India, steel contracts were being traded only on the ICEX. Both the BSE and MCX were planning to launch the contracts and with its discontinuance, the steel contracts are likley to shift to the two exchanges
Indian Commodity Exchange Limited (ICEX) will be shutting its commodity business and has applied for it with the Securities and Exchange Board of India (SEBI). The market regulator had said that the exchange will be “kept in abeyance” for year in accordance with rules. Zee Business’ Tarun Sharma has this exclusive report.
The closure is expected to help Multi Commodity Exchange of India (MCX) and the BSE Limited, Sharma said in his report. ICEX has kept its commoditiy business in abeyance.
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Of all the the commodity exchanges in India, steel contracts were being traded only on the ICEX. Both the BSE and MCX were planning to launch the contracts and with its discontinuance, the steel contracts are likley to shift to the two exchanges.
Rubber and diamond were other commodities which had a sizeable volume in the ICEX. They will also now go to BSE and MCX.
This is not a good news for the commodity business, he said. On the one side, National Commodity Exchange of India (NCDEX) is getting merched into NSE and on the other side ICEX is sutting its commodity operations.
ICEX’s closure comes amid the financial crunch to run the business. ICEX will now be providing onlt the Mutual Fund platform. It is working on a product which is similar to BSE Star Mutal Fund. MJ Investments has taken a 5 per cent share on this.
Sharma said that the while the volumes were worth only Rs 500-1000 cr, the trdes were specific to ICEX only. Now they will move to MCX and BSE, he added.
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Zee Business Managing Editor called this a big development particularly for MCX and said that ICEX's loss is a gain for MCX and the BSE.