Currently available for delivery in June, July, August and September, the CPO contracts are almost illiquid on NCDEX.
"We held four phases of consultations with our participants. Now, we would like to remove some anomalies in the structure of the contracts such as ex-Kandla quote and Kandla delivery centre etc," said Unupom Kausik, chief business officer, NCDEX. The revised contract would be ready for trade within a month, he added.
Reportedly, the exchange has obtained assurances for trader participation on the promise of anomalies removal.
Meanwhile, these contracts are attracting a daily turnover of Rs 60-70 crore on MCX. It was launched on June 9 on the exchange. Currently, CPO contracts are available for trade on MCX for delivery in July, August and September.
Yesterday, the Indore-based NBoT launched CPO with the contracts for all months attracting volumes of about Rs 10 crore on the first day. Since the de-listing of refined soy oil, NBoT is concentrating on oilseeds and oil-based products.
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The recently introduced soybean seed contract is doing well and generating an average daily turnover of around Rs 40-50 crore. The exchange is now planning to launch mustard seed contract in near future.
"CPO and mustard seed are major focus areas for us as of now. But we have sought permission from the Forward Markets Commission for launching non-agri commodities, including gold and base metals, about four months ago. The regulator's nod is still awaited," said Ravessh Bafna, deputy executive director, NBoT.
About the success of CPO contract, an MCX official said, "Designing of the contract is the most important aspect. The production and consumption centres of a commodity have to kept in mind before launching any contract. We have designed the contract paying special attention on these two aspects."
The most important difference between the contract specifications of MCX and NCDEX is the delivery centre, which is "within Kandla municipal limit" for MCX and "Kandla (within a radius of 50 km of municipal limit)" for NCDEX.
Additionally, the tick size of the MCX contract has been fixed at Re 0.10, while the same on NCDEX remains lower at Re 0.05. The open position limit for client on MCX and NCDEX has been set at 20,000 tonnes and 12,000 tonnes, while that for members at 5,000 tonnes and 6,000 tonnes, respectively.
India imported 5.3 million tonnes of palm oil in 2007 which is estimated to go up to 5.8 million tonnes in 2008 and 6.5 million tonnes in 2009.