Maharashtra government launches hedging desk for cotton, turmeric and maize to help farmers
(PTI) To ensure fair market prices and increased income for farmers, the Maharashtra government has launched a hedging desk in Pune under the first phase of the Balasaheb Thackeray Agribusiness and Rural Transformation (SMART) project.
The desk will initially focus on cotton, turmeric and maize crops. Over time, the initiative will be expanded to cover more crops, a statement from the Chief Minister's Office (CMO) said.
In collaboration with the National Commodity and Derivatives Exchange (NCDEX) and its research wing NCDEX Institute of Commodity Markets and Research (NICR), the initiative aims to protect farmers from losses due to market price fluctuations.
Chief Minister Devendra Fadnavis called it a major step for the development of the agriculture sector.
Hedging, like a fence protecting the farm, protects farmers from risks caused by price fluctuations in the market. Its main objective is to mitigate risks arising from potential price declines in the future. Farmers can also benefit from options trading, which allows them to lock in favourable prices, the statement said.
Based on World Bank recommendations and the project implementation framework, the hedging desk has been set up to provide training and guidance to farmers and farmer producer organisations (FPOs) to participate in the commodity futures market.
Agriculture contributes 12 per cent to Maharashtra's gross state domestic product (GSDP), yet crop production is still heavily dependent on nature.
Despite successful crops, farmers often lack price control over their produce. To tackle this uncertainty, the government has supported them through policies, modern agricultural practices and crop insurance schemes.
Recognising the limited resources and market knowledge of individual farmers, the government has now set up a dedicated, centralised agricultural hedging desk in Pune, it said.
The hedging desk will work with FPOs and cluster-based business organisations (CBBOs) to provide technical information on commodity contracts and risk management strategies.
This desk will provide real-time market information on trends, supply-demand changes and global prices. It will also promote setting up of storage centres near farms through FPOs.
A risk management cell will analyse various types of risks and prepare mitigation strategies. It will publish annual commodity price risk assessment reports for cotton, maize and turmeric, offering current insights, forecasts and policy recommendations. Awareness and training programmes on commodity derivatives will also be organised.
Additionally, at least 50 FPOs involved in the production and marketing of cotton, maize and turmeric will be registered and facilitated to trade in the futures market.
A formal agreement was signed between NCDEX and Smart Project on April 8, 2025 for setting up this hedging desk. Special focus will be given to FPOs and farmers in cotton, turmeric and maize growing areas, especially in Hingoli, Washim, Sangli, Yavatmal, Akola, Nanded, Amravati, Chhatrapati Sambhajinagar and Beed.
The project is headquartered in Pune and has started operating across the state.
Hedging and options trading in select agricultural commodities are expected to bring huge benefits to farmers in Maharashtra. For example, a farmer unsure about future market prices at the time of sowing can lock in the price using options trading. This guarantees a minimum selling price, protecting them from market volatility, the statement said.
Ultimately, this helps farmers get a stable income, plan financially better and feel more confident about investing in agriculture.
