India's first exchange-traded rainfall futures contract, RAINMUMBAI, has recorded around 20,000 lots traded during its first month since its launch on the National Commodity & Derivatives Exchange (NCDEX). The contract, introduced in late May 2026, is designed to help market participants hedge financial risks arising from variations in Mumbai's monsoon rainfall.
According to NCDEX, the contract has also started serving its key objective by providing a forward-looking indicator of rainfall expectations during the monsoon season.
RAINMUMBAI is India's first exchange-traded weather derivatives contract based on Mumbai's rainfall. The contract tracks deviations in actual rainfall from the city's long-period average (LPA) during the monsoon season rather than measuring absolute rainfall.
The rainfall data used for settlement is sourced from the India Meteorological Department (IMD). The contract is cash-settled, with contracts available for the monsoon months of June, July, August, and September.
The launch coincided with Mumbai experiencing one of its driest starts to the monsoon in recent years. The delayed arrival of the southwest monsoon resulted in below-normal rainfall during June, making rainfall deviations from historical averages an important indicator for market participants.
NCDEX said futures prices have broadly tracked and anticipated changing rainfall patterns, helping establish the contract as a price discovery and directional indicator for rainfall expectations.
According to NCDEX:
Around 20,000 lots were traded during the first month.
The average daily trading volume stood at approximately 1,000.
The highest single-day trading volume reached 2,039 lots on June 15.
Participation increased steadily week after week, particularly around major weather updates and rainfall events.
The exchange noted that the first month primarily focused on market familiarisation while also demonstrating the contract's practical use in reflecting rainfall expectations.
NCDEX expects trading activity to increase as the monsoon progresses, and rainfall uncertainty rises.
According to the exchange, greater volatility in rainfall expectations is likely to improve the relevance of rainfall futures, leading to stronger participation, higher liquidity, and better price discovery. It also noted that early trends in the July and September contracts indicate that futures prices are acting as forward-looking indicators rather than merely reacting to rainfall events.
The exchange expects higher trading activity around significant weather developments and wider adoption among participants with weather-linked business exposure.
RAINMUMBAI, India's first exchange-traded rainfall futures contract, recorded around 20,000 lots traded during its first month on NCDEX. The contract aims to provide market participants with a mechanism to hedge rainfall-related risks while offering a forward-looking indicator of monsoon expectations based on deviations from Mumbai's long-period average rainfall.
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Published on: Jul 1, 2026, 5:17 PM IST
Rakesh Deshmukh
Rakesh Deshmukh is a financial content specialist with around 3 years of experience writing impactful content across equities, mutual funds, IPOs, and personal finance. At Angel One, he decodes real-time market trends and breaking news, helping investors and traders stay updated. He also helps investors make informed decisions by simplifying market fundamentals and technical analysis. He holds a bachelor’s degree in commerce.
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