Government probing speculation in agri commodities

New Delhi, April 13 (IANS) Concerned over excessive speculation leading to price fluctuation of some essential commodities being traded at the Forward Markets Commission recently, the government Friday said it will take action after getting the report of secretary consumer affairs in 10 days.

"We are not jumping on to any conclusions...We will decide on the action to be taken after getting the report from secretary consumer affairs who is probing the issue," Food and Consumer Affairs Minister K.V. Thomas told reporters after meeting with the chairman of the FMC Ramesh Abhishek here.

Secretary consumer affairs Rajiv Agarwal will submit his report on commodities like gram, mustard oil, pepper, soya oil, soya bean, cardamom, potato and mentha oil to Thomas in the next 10 days.

The ministry has asked the FMC to assess if hoarding of these commodities is responsible for their price fluctuation and how this activity is being financed.

It has also decided to form commodity specific committees to keep a close watch on the trading of these commodities and advise both the government and the FMC.

The advisory panels would include representatives of the farmers, traders and media.

A separate panel to look into the futures trading of rubber has also been constituted by the ministry after Kerala Chief Minister Oommen Chandy raised the issue with Thomas.

The government had banned the futures trading of Guar seeds in March but its prices continued to rise.

Theoretically, the futures market only acts as a platform for price discovery and price risk management for the physical market participants.

"The government is of the considered view that the futures markets should not be used for hoarding commodities and there should be no illegal management of finances," said Thomas.