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NCDEX launched RAINCHNNAI, a weather futures contract on Chennai's Northeast monsoon rainfall, reported on 31 August 2026 after SEBI approval.
The contract is cash-settled and references official India Meteorological Department rainfall data from the Meenambakkam and Nungambakkam stations.
Settlement uses a Cumulative Deviation Rainfall model that measures deviation of actual rainfall from the Long Period Average.
Tick size is 1 millimetre, the maximum order lot size is 50 lots, and the open interest threshold is 116,400 millimetres.
Expiries in September, October, November and December are available initially; it follows RAINMUMBAI, India's first rainfall futures contract, launched in May 2026.
A weather derivative is a financial contract whose payoff depends on a measured weather variable - rainfall, temperature, snowfall - rather than on the price of any traded good. It exists because many businesses lose money when the weather misbehaves even though nothing they own has changed in price: a beverage company in a cool summer, a hydro plant in a weak monsoon, a city water utility in a failed Northeast monsoon. Since nobody can deliver rain, these contracts are always cash-settled against an official measurement, which is why the identity of the weather station and the index formula matter more here than in any other derivative.
Simple Analogy: It is insurance you can trade: instead of claiming from an insurer after a bad monsoon, you hold a contract that pays out when rainfall falls short.
India's leading agricultural commodity derivatives exchange; launched RAINMUMBAI and RAINCHNNAI
Regulator of India's securities and commodity derivatives markets; approved the new weather contracts
National agency for weather observation and forecasting; supplies the official rainfall data the contract settles against
General Awareness > Financial Markets, Derivatives and Regulators
GS Paper 3 > Economy > Capital Markets; GS Paper 1 > Indian Monsoon
General Awareness > Economy and Geography
Which of the following is a Kharif crop?
Answer: Maize
A financial contract whose value depends on a measured weather variable such as rainfall or temperature
The index used by these contracts, tracking accumulated deviation of actual rainfall from the Long Period Average
The long-run average rainfall for a location and season, used as the benchmark for 'normal'
Settling a contract by paying the difference in money at expiry, with no physical delivery of the underlying
The retreating monsoon of roughly October to December, which brings most of Tamil Nadu's annual rainfall