BSE launches delivery-based futures contract in steel billets

Leading stock exchange BSE on Thursday announced the launch of trading in delivery-based futures contract in steel billets, which will provide a risk hedging instrument to stakeholders. The futures contract was designed jointly with Steel Users Federation Of India (SUFI) keeping in mind the industry participants needs and participation, the exchange said in a statement.

Sajjan Jindal, chairman and managing director of JSW Group, who launched BSE's steel billets futures contract, said "unlike other commodities, the India's steel industry lacks a transparent benchmark for setting prices or a way to offset the risk of price movement. With the introduction of futures in steel billets on BSE, the physical steel supply chain would be in a better position to mitigate price risks and volatility."

"Launch of steel billet futures contract is in alignment of our long-term vision to deepen product offerings and widen commodity derivatives market in India. We strongly believe this contract will provide an effective risk hedging instrument to stakeholders associated with steel business and look forward to a wider participation from stakeholders across the country," Ashishkumar Chauhan, MD and CEO, BSE said.

Nikunj Turakhia, President, SUFI, said "the BSE SUFI Steel billets futures prices will serve as a ready reference price to the steel trading community. BSE and SUFI are confident that the stakeholders in the physical steel market will be able to benchmark different steel products they deal against the BSE SUFI steel billets price.