The Mumbai Rainfall Futures index for July expiry on NCDEX surged as much as 8% to hit an intraday high of 2,609 on Monday. According to reports from NCDEX, the index came into existence on May 29 and provides a transparent, regulated platform for hedging rainfall-related financial exposure. The contract offers financial settlement with no physical delivery obligation, serving as an effective risk management instrument for participants exposed to rainfall variability.
Intermittent heavy rain and gusty winds disrupted daily life in Mumbai and neighbouring districts on Monday, as reported by NCDEX. The IMD has issued an orange alert for Mumbai, with a red nowcast warning for intense rain and gusty winds, with the weather agency forecasting more downpours during the day. Train services on the busy Mumbai-Pune route were suspended after heavy rains triggered landslides in the Karjat-Lonavala Bhor Ghat section. The Central Railway also suspended local train services between Karjat and Khopoli in neighbouring Raigad district after heavy rain washed away the ballast between Lowjee and Dolavli stations. Several trains have been cancelled, diverted, or regulated, impacting all three railway lines, with the Mumbai-Pune Expressway and old highway also closed to traffic following landslides. Schools and colleges in Mumbai, Pune, Thane, and Palghar have been shut for safety, while offices remain open. Mumbai's flight operations are facing significant disruptions due to heavy rainfall and poor visibility, with major airlines like IndiGo, Akasa Air, SpiceJet, and Air India issuing travel advisories and urging passengers to check flight status.
The underlying index tracks the Cumulative Deviation Rainfall (CDR), measuring the variance of Mumbai's actual monsoon rainfall against a 30-year historical average of 2,206.7 mm using data from the India Meteorological Department (IMD). According to NCDEX, daily rainfall is compared with the long-period average during the monsoon season from June to September. The traded rainfall of CDR is calculated daily at 9:00 am for the past 24 hours, with futures contracts trading on NCDEX with an expiry on the last business day of the month.
Each contract is traded in a multiplier of ₹50 per mm, as reported by NCDEX. The futures contract provides efficient price discovery and supports mitigation of weather-related financial uncertainties using reliable rainfall data. The contract offers financial settlement with no physical delivery obligation, making it suitable for hedging rainfall-related financial exposure in the Mumbai region.
