The National Commodity and Derivatives Exchange has slashed the transaction charges on sugar contract to 10 paise per ₹1 lakh of trade from ₹4 charged earlier. The exchange has also done away with the risk management fee of ₹4 on sugar contract to boost liquidity on the exchange platform as the country is all set for a bumper harvest this sugar season (October 2017-September 2018).

The Centre has withdrawn stockholding and turnover limits on sugar dealers with immediate effect as it expects the demand-supply situation to remain comfortable. The lower transaction charges will encourage increased market participation and provide a cost-effective hedging avenue in the form of sugar futures, said the exchange in a statement on Wednesday.

The Centre’s withdrawal of stockholding and turnover limits on sugar dealers is expected to encourage large co-operatives and millers to hedge their risk on the exchange platform.

Samir Shah, Managing Director, NCDEX, said the exchange’s sugar future contracts are aimed at offering a wholesome risk management and robust price discovery tool to the market.