Cochin Oil Merchants Association (COMA), along with the First Commodity Clearing Corporation of India (FCCCI), had been pursuing the matter for long and in September last year, had formed a joint venture in Kochi, called the First Commodities Exchange of India Ltd with the intention of readying for this trade.

COMA secretary Ananthan told The Financial Express that once the official notification was acquired, it would take another two months to set things in order and futures trading could start by April. Members would have to be drawn in for the trade, and formalities would have to be worked out based on the needs of many a member, he added.

It was way back in 1999 that the Centre decided to have futures trade in eight oil seeds, including coconut. Following this the company was formed in Kochi and a representation was made for allowing the company to start futures trade. Mr Ananthan said the by-laws and other exchange rules had already been formulated.

Coconut oil prices have for quite sometime been subjected to the vagaries of price fluctuations and the prices have dipped to abyssmal levels. Coconut oil has now been trading at Rs 28-29 a kg. Once futures trade is launched, these fluctuations will be evened out and there will be price stability, he feels.

The Forward Markets Commission, which will play the regulator's role will have control over a market, which has now been left unbridled. Futures trade may not mean increase in price. But it would mean a lot for the growers and traders, who have been mute witnesses to price swings. The whole idea of futures trade, is a process of discovering or rediscovering price. Both farmers and traders can get a feel of the what is happening in the market and adjust holding of their commodity and take appropriate decisions, Mr Ananthan said.

Futures trade would ensure a steady quantitative supply throughout the year. Through cooperatives, farmers could hedge in the futures market, traders said. However, things are not without hitches. Says Mr Ananthan, the decision to make online trading mandatory from day one, would jeopardise all plans. He says this clause was not applicable to futures trade in groundnut, sunflower or soyabean.

Why then this discrimination, traders and growers ask. Things can traverse to wider contours, if the FMC plans to launch futures trade in other commodities fructify. Now the state has only seen futures trade in pepper. Once the dollar-denominated trade in pepper starts and also the futures trade in copra and coconut oil, the exchange will have a greater role to play. The move for futures trade in rubber, has been in the air for quite sometime. When the trade in other commodities begin, sources expect rubber too, to follow suit and give the necessary push to the other commodities in the state.