Mumbai, Nov. 10 -- Commodity exchange NCDEX has entered into a three-year strategic collaboration with BigMint Technologies, known as BigMint, to develop transparent spot price benchmarks for steel scrap derivatives in India. The partnership is intended to improve market credibility and provide participants with a dependable mechanism for managing price risk.
Under the Memorandum of Understanding, BigMint's daily spot price assessment for steel scrap will serve as the reference price for the final settlement of steel scrap derivative contracts that NCDEX plans to launch. The arrangement will link the proposed exchange-traded contracts to an independent assessment of physical market prices.
BigMint will oversee benchmark development, market data collection, grade normalisation and price assessment processes. Its assessment framework is expected to support greater transparency and consistency in the settlement mechanism, while providing market participants with a clearer basis for evaluating steel scrap prices.
The two organisations will also undertake member awareness programmes, broker outreach and initiatives aimed at building liquidity for the contract. These activities are intended to encourage participation and strengthen the connection between the physical steel scrap market and the proposed derivatives segment.
NCDEX managing director and chief executive Vikas Goel said the credibility of a derivatives contract depends on the price against which it is settled. He said the collaboration would anchor the planned steel scrap contracts to an independent, transparent and IOSCO-aligned benchmark, and would complement the existing physical market by helping participants manage price risk. The partnership is expected to contribute to a more resilient steel ecosystem in India.
Published by HT Digital Content Services with permission from Construction World.