Reinstatement of sugar futures will spur volumes and hedging

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India's commodities market regulator, the Forward Markets Commission (FMC), lifted the ban on sugar futures last week, in a move that market experts say will spur Indian appetite for hedging.

The FMC banned sugar futures in May 2009 under the belief that speculative trading was responsible for pushing up food prices. Keeping food prices under control is a central issue for the Indian government, as 42% of the population are below the international poverty line and live on less than $1.25 a day.