Forward Market Commission (FMC) will impose an initial margin of 10% across all contracts of wheat and sugar from Monday, August 6. At present, the cash to be paid as normal margin on wheat for buying contracts on NCDEX is 4.78% and 4.41% on sugar, while at MCX, intial margin is 8.9% and 5% on wheat and sugar respectively.
Sugar prices and wheat prices have continued to rally on expectation of tight supply situation throughout coming festival period. Sugar futures and wheat futures hit a new high on strong buying support and is pushing prices higher in physical market despite regular demand. Producers are reluctant to sell at lower price sustaining good exchange support.
Also, the deficient monsoon, high global prices and India entering the festive season have led to a rise in prices. Due to the lower output concerns in this kharif season, wheat and sugar contracts have been increased during last few months. Earlier too, the commodity market regulator, FMC has implemented various measures such as reducing the maximum an investor can buy or sell in a commodity and increase margins to bring down prices.