MCX Introduces 'Silver 100' Futures Contract

'Silver 100' futures contract to begin trading on June 1, 2026.
Average Daily Turnover in Silver Futures and Options exceeds ₹96,000 crore in FY26.

Reader Takeaway: New contract targets retail/SME hedging needs; domestic silver sourcing focus.

What just happened

Multi Commodity Exchange of India Ltd (MCX) announced the launch of its 'Silver 100' futures contract, effective June 1, 2026. This new contract is designed to cater to the specific hedging requirements of jewelers, Small and Medium Enterprises (SMEs), and retail investors, offering smaller denomination options.

Why this matters

The 'Silver 100' contract aims to increase participation from a wider base of market participants, particularly those who deal with smaller volumes of silver. By offering a more accessible contract, MCX seeks to enhance liquidity and deepen the market for silver derivatives. This initiative supports the exchange's strategy to broaden its bullion portfolio and attract more retail and SME investors.

The backstory

MCX already offers several silver futures and options contracts, including 30 kg, 5 kg, and 1 kg futures, and 5 kg and 30 kg options. The average daily turnover for silver futures in FY2026 was ₹21,648 crore, while silver options saw ₹74,883 crore. MCX holds a dominant 98% market share in commodity futures as of FY2024-25.

What changes now

The introduction of 'Silver 100' provides a new hedging tool that aligns better with the inventory needs of local jewelry businesses. This can reduce the need for excessive capital commitment. Additionally, MCX is revising its 'Good Delivery Norms' for silver and inviting domestic refiners to apply for empanelment, promoting domestic supply chains.

Risks to watch

The success of the 'Silver 100' contract will depend on its liquidity and adoption by the target audience. The effectiveness of the revised Good Delivery Norms in encouraging domestic sourcing and recycling also remains to be seen.

Peer comparison

MCX is the leading commodity exchange in India, holding a significant market share. Its competitors include the National Commodity and Derivatives Exchange (NCDEX) and the Indian Commodity Exchange (ICEX), though MCX dominates in terms of turnover and market share, especially in bullion and base metals.

Context metrics (time-bound)

• Average Daily Turnover (Silver Futures) FY 2026: ₹21,648 crore
• Average Daily Turnover (Silver Options) FY 2026: ₹74,883 crore
• Market Share (Commodity Futures) FY 2024-25: 98%

What to track next

Investors should monitor the trading volumes and liquidity of the 'Silver 100' futures contract in the initial quarters post-launch. Tracking the empanelment of domestic silver refiners and any changes in import dependence will also be crucial.