NCDEX stops all future contracts trading in Guar Gum, Seed
As per the directives of the Forward Markets Commission it is hereby informed that all futures contracts in Guar Gum (GARGUMJDR) and Guar Seed (GARSEDJDR) currently being traded on the Exchange are closed out
As per the directives of the Forward Markets Commission it is hereby informed that all futures contracts in Guar Gum (GARGUMJDR) and Guar Seed (GARSEDJDR) currently being traded on the Exchange are closed out in the following manner:-
(i) The Sellers intending to give delivery will be allowed to do so and the delivery intentions so received will be allocated to the Buyers as per normal process.
(ii) The delivery settlement will be as per the revised settlement calendar which will be communicated to the Members.
(iii) The remaining outstanding positions as at the close of trading day on March 27, 2012 will be closed out at the Daily Settlement Prices (closing prices) of March 27, 2012.
The commodity market regulator Forward Markets Commission (FMC) had barred with immediate effect the fresh positions in guar seed and guar gum futures. "We have decided to stop taking fresh positions in guar seed and guar gum contracts this season till September. We are allowing traders who have existing positions to unwind their positions," FMC chairman Ramesh Abhishek told reporters at `Future of Financial Markets Summit 2012' here.
In a notification earlier, the FMC, which regulates the futures market, said no fresh positions will be allowed in April, May, June and July contracts of guar seed and guar gum from Thursday. The bar includes intra-day trade. The FMC had disallowed August and September futures.
The future prices of guar seed and guar gum shot up in last one year owing to rampant speculative trading. Commenting on the late decision in banning the trade, Abhishek said that FMC in consultation with commodity exchanges found that this was the right time to take the decision.
"We found that there was not much of liquidity in the contract as arrivals of guar seed have virtually dried up. In view of falling turnover volume in contract, we found that there is no point having any fresh position," Abhishek said. FMC has already imposed additional margins of 10% over and above the earlier margins of 7% in potato futures trading, he said.
FMC has urged the government to bring electronic spot exchanges under the regulator, Abhishek said, adding that it has drafted the bill and presented to the government. FMC is also seeking approval from the government to set up National Institute of Commodity Market.
"We are seeking the government's approval and Rs 90 crore from the 12th Five Year Plan to set up National Institute of Commodity Market which will offer degree/diploma courses in commodity sector." Commenting on FCRA bill, chairman said that he is hopeful of implementation of FCRA Act in the current year.
(With inputs from PTI)
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