NMCE refutes allegation of ATMA on rubber price manipulation

New Delhi, Dec 1 (PTI) Ahmedabad-based commodity bourse NMCE today dismissed tyre-makers body ATMA''s allegations that the exchange was manipulating rubber futures price, saying the rates have risen on demand-supply mismatch.
"There has not been any manipulation of natural rubber prices at our exchange. The allegations made by the Automotive Tyre Manufacturers Association (ATMA) are incorrect and baseless," NMCE CEO Anil Mishra told PTI.
He pointed out that the price movement in the natural rubber futures at NMCE was not because of manipulation but on account of supply-demand mismatch.
Recently, ATMA had taken up the issue with the commodity markets regulator FMC about price manipulation in natural rubber trade at the NMCE platform and sought either temporary ban on future trade of rubber or cut in daily price band.
"As a result, FMC had asked us to justify the price movement in natural rubber and we clarified our stand. After looking into the matter, FMC said clearly that ATMA''s allegation was wrong and without any evidence," Mishra said.
According to the exchange data, the futures price of the December month contract has risen by 21 per cent to around Rs 200/kg now since the launch of the contract in August.
When contacted ATMA Director General Rajiv Budhraja said: "We are not happy with the FMC'' response on our complain. We will write to the regulator again on Monday on this issue."
On ATMA''s demand to reduce daily price band to curb manipulation, Mishra said, "The daily price band for natural rubber has been kept lowest at 4 per cent in India as compared to 5 per cent in Shanghai and 10 per cent in Singapore. If we reduce from 4 per cent to 1-2 per cent, then trade can hardly take place on the exchange."
At present, a large number of farmers are participating in the rubber futures trade through co-operatives, Mishra said, adding that on an average, 7,000 tonnes of rubber is traded daily on the exchange platform.

(Source: http://news.in.msn.com/business/article.aspx?cp-documentid=4647726)