Archive · 10 Aug 2025
FPOs Enhance Farm Futures Trading for Better Price Discovery
Imagine farmers getting together to sell their crops.
Instead of selling to traders, they can now sell through special markets, like the stock market, for food.
This helps them get better prices for their crops, like cumin and castor seeds.
Over 700 groups of farmers, called FPOs, are already doing this.
They are selling things like cotton and seeds, and it helps them earn more money.
The government is also helping these farmer groups by giving them money and support.
However, trading of some crops on these markets has been paused temporarily.
Futures trading in agricultural commodities is progressing with over 700 FPOs trading on the NCDEX.
FPOs have traded various commodities including cotton, cumin seeds, and castor in FY26.
Selling through commodity exchanges formalizes trade, with payments going to FPO bank accounts.
Some FPOs have reported earning approximately 10% more prices by selling on commodity exchanges.
The Securities and Exchange Board of India has extended the suspension of trading in derivative contracts for certain agricultural commodities until March 31, 2026.
- Who
- Farmer Produce Organisations (FPOs), farmers, and the Securities and Exchange Board of India (SEBI).
- What
- Progress in futures trading of agricultural commodities by farmer produce organizations (FPOs).
- When
- First quarter of FY26 and ongoing.
- Where
- NCDEX (National Commodity and Derivatives Exchange) and various farmer collectives across India.
- Why
- To provide better price discovery, improve market access, and formalize agricultural trade.
Farmers collective benefits
Regulatory body's viewpoint
Commodity Market Access
Farmers collective benefits
Farmer groups have found the commodity exchanges to offer better prices as opposed to trading through their traditional means.
Regulatory body's viewpoint
The regulatory restrictions prevent the expansion of trading and limit benefits to farmers.
- FPOs Trading on NCDEX
- 702
- Farmers Represented
- Over 1.16 million
- Commodities Traded
- Cotton, cumin seeds, castor, coriander, turmeric, cottonseed oil cake, guard seeds
- Price Increase Reported
- Approximately 10% (in some cases)
- FY25 FPO Sales Turnover > Rs 10 crore
- 340
- FPOs on ONDC
- Over 9,450
- Scheme Budget
- Rs 6,865 crore (FY21-FY26)