NATIONAL COMMODITY & DERIVATIVES EXCHANGE LIMITED
Circular to all Trading and Clearing Members of the Exchange Circular No: NCDEX/TRADING-090/2005/202 Date: October 04, 2005 Subject: Launch of Contracts and Commodities: V-797 Kapas Contract ______
The Exchange is pleased to inform its Members that effective October 4, 2005, V-797 Kapas contract is being offered for trading.
The said contract expiring on April 20, 2006 will be available for trading from October 4, 2005.
The salient features of the contracts are given as Annexure I. Detailed contract specifications are as per Annexure II. Members are requested to take note of the same.
For and on behalf of National Commodity & Derivatives Exchange Limited
Narendra Gupta Chief Business Officer
For Further information / clarifications, please contact 1. Mr. Abhijeet N. Shinde - Phone - 022 5640 6645; Mr. Sudip Majumdar- Phone - 022 5640 6575 2. Helpdesk by E-mail to: [email protected]
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Annexure I Salient features of the V- 797 Kapas contract:
· Quality specifications The kapas quality would be judged on the basis of cotton turnout percentage. The turnout basis would be 40% (+/ - 2%) cotton and 60% seeds (-/+ 2%). Delivery can be made up to 36% of cotton but with a discount in the ratio of 1:1 over the basis price and similarly delivery can be made above 42% with a premium of 1:1 over the basis price.
· Basis centre: The basis centre for Kapas prices would be Ex-warehouse Surendernagar, Gujarat (exclusive of all taxes) .
· Contract Trading Months : The first Contract would be launched on October 4, 2005 and would expire on April 20, 2006.
· Quotation base value Quotations would be accepted for Rs / 20 kg (1 maund=20 kg)
· Tick size: Tick size of the contract would be 10 paisa.
· Delivery Specifications: Upon expiry of the contracts, if any seller with open position desires to give delivery at a particular delivery center, then the corresponding buyer with open position as matched by the process put in place by the Exchange shall be bound to settle by taking physical delivery. The Kapas contract will be on Seller’s choice to deliver and penalty on seller for not choosing to exercise his option will be 0.5%.
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Registered Office : Exchange Plaza, C- 1, Block G, Bandra East, Mumbai 400 051, India. Phone : +91-22-5640 6789, Fax +91-22-5640 6899, Website : www.ncdex.com
· Pre Expiry margin The pre expiry margin for Kapas contract would be 3% incremental per day for the last 5 trading days prior to expiry of a contract.
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Registered Office : Exchange Plaza, C- 1, Block G, Bandra East, Mumbai 400 051, India. Phone : +91-22-5640 6789, Fax +91-22-5640 6899, Website : www.ncdex.com
Annexure II
V-797 KAPAS FUTURES CONTRACT SPECIFICATIONS
Type of Contract Futures Contract Specifications Name of Commodity V 797 Kapas Ticker Symbol KAPV797SRN Trading system NCDEX Trading System Basis Ex- warehouse Surendernagar (Exclusive of all taxes ) Unit of trading 200 maunds of 20 kg each (4 MT) Delivery unit 200 maunds of 20 kg each (4 MT) Quotation/base value Rs. Per 20 kg Tick size 10 paisa Quality specifications Raw Cotton (Cotton traded as V – 797) 1. Turnout Turnout % Cotton Basis 40% (+/- 2%) Cotton seed 60% (-/+2%)
2. Trash content: Allowable up to 1.25 % max., beyond which discount in the ratio of 1:1 will be applicable
3. Moisture:8.5%
Quantity variation +/- 1.25% for total weight of each deliverable lot Premium/Discount The seller will get a proportionate premium over every incremental percentage over 42% and similarly a proportionate discount below 38%.The seller can make delivery of goods upto 36% turnout of cotton below which the goods would be
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Registered Office : Exchange Plaza, C- 1, Block G, Bandra East, Mumbai 400 051, India. Phone : +91-22-5640 6789, Fax +91-22-5640 6899, Website : www.ncdex.com
rejected. Contract for April 20 next year expiry will open for trading on Trading month 10th August of the preceding year. Delivery center Surendranagar (Gujarat) Trading hours As per directions of the Forward Markets Commission from time to time, currently (with effect from April 25, 2005) –
Mondays through Fridays : 10:00 AM to 05:00 PM
Saturdays : 10.00 AM to 2.00 PM
The Exchange may vary the above timing with due notice Delivery specification Upon expiry of the contracts, if any seller with open position desires to give delivery at a particular delivery center, then the corresponding buyer with open position as matched by the process put in place by the Exchange shall be bound to settle by taking physical delivery No. of active contracts One Opening of contracts The first contract will be launched on October 04, 2005.
Thereafter, further contracts would be launched on August 10 which would expire on April 20 of the following year. Due date/Expiry date April 20 of every year.
Closing of contract All open positions will be settled as per general rules and product specific regulations Price band 4%.
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Registered Office : Exchange Plaza, C- 1, Block G, Bandra East, Mumbai 400 051, India. Phone : +91-22-5640 6789, Fax +91-22-5640 6899, Website : www.ncdex.com
Position limit Member: Maximum of 75000 MT for all contracts Client: Maximum of 15000 MT for all contracts
As regard exemption to bonafide hedger it is stated that twice the prescribed limit would be available to the hedger .
Special margin Special margin of 4% of the value of the contract will be levied whenever the rise or fall in price exceeds 20% of the 90 days prior settlement price. The margin will be payable by buyer or seller depending on whether price rises or falls respectively. The margin shall stay in force so long as price exceeds the 20% limit.
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Registered Office : Exchange Plaza, C- 1, Block G, Bandra East, Mumbai 400 051, India. Phone : +91-22-5640 6789, Fax +91-22-5640 6899, Website : www.ncdex.com