On 11 March 2004, the Multi Commodity Exchange of India (MCX) became the first-ever exchange in the world to allow online futures trading in steel. The production of steel which is approximately Rs75,000 crore is expected to "generate trade worth 10 times," commented Jignesh Shah, MD of MCX. Besides broad basing its basket of commodities being traded on the exchange, steel futures will also have a salutary role in curbing the growing volatility in steel prices witnessed in recent times. Formally launched in mid-March on the terminal of Maximus Commodities - a member of MCX by steel titan Jamshed Irani, the former MD of Tisco, MCX steel Futures contracts are initially offered against two underlying products viz. steel long, pencil ingots and steel flat represented by underlying product HR coils of notified size. The users for the first would include construction companies, rolling mills, ship breakers while for the flats the futures could be used for hedging by automobile, pipe HR/C/GP manufacturers.

MCX which has successfully established a market for trading in gold, silver, castor seed, rubber and pepper, hopes to draw both domestic and international players on its steel platform. "It is expected to revolutionise the commodities market," said Hemant Mehta, chairman of Maximus Commodities at the inaugural function. Indian steel production at the current levels account for less than 4 per cent of global production. However, with the large amount of iron ore and the soaring prices in international markets, several domestic players have drawn up extensive expansion plans which could on successful implementation, put it in the top league of producers. And I focus international attention on this industry. This is what MCX is betting on.