The dearth of a price discovery mechanism in commodities and lack of opportunities to hedge raw material requirements is spurring India Inc to participate in futures trading.

The list includes ITC, Hindustan Lever, Godrej, Hindalco Industries, IVP, EID Parry, Tata Exports, Adani Wilmar and Adani Exports.

Even companies dealing remotely with agro produce and industrial produce are working out modalities of participating in commodities futures trading.

The new market is set to gallop ahead with two more national commodity exchanges coming up in the second quarter of the current fiscal year, most likely in July.

A couple of cotton textile mills are interested in hedging and ensuring smooth supply through commodity futures and derivatives trading.

Multinationals such as Cargill are keen on hedging and taking calls on the Indian agro produce through the futures trading.

A J S Jhala, joint president, treasury and company secretary, Hindalco Industries, said his company was looking forward to a revival of metal futures trading.

Hindalco, like any other aluminium producer in the world, gets its reference rates from the quotations at the London Metals Exchange (LME) despite 80 per cent of its sales coming from the domestic market.

It also has to factor in the domestic price determinants into the LME reference rate, thus making a case for hedging in the domestic market.

Nalin Khanna, general manager, EID Parry, which has a huge interest in sugar futures, said: "There is currently no transparent and secured mechanism to discover prices in futures in order to make business decisions both by the farmers and the industry. An organised futures exchange provides this."

ITC, Hindustan Lever and the Godrej group have agro produce requirements such as tobacco, wheat, castor oil (for soaps and detergents, fertilisers and animal feeds (oilcakes and oil meals), apart from chemicals.

The government freed the commodity futures trading from the restrictions levied in early '60s and has given a go-ahead for setting up four national level commodity futures and derivatives exchanges which will have nationwide reach through online trading system and T+1 settlement system.

Those in the fray

• VITC
• Hindustan Lever
• Godrej
• Hindalco Industries
• IVP
• EID Parry
• Tata Exports
• Adani Wilmar & Adani Exports