NCDEX to meet jeera traders on contract row

Senior officials of the National Commodity & Derivatives Exchange (NCDEX) are likely to meet the Jeera (cuminseed) Product Committee representatives in Unjha on Tuesday to discuss the issues related to quality, margins and open interest in the contract specification.

A majority of the committee members, basically from the trading community, have apparently decided to resign from the committee with immediate effect over complaints that the exchange has been imposing its decisions on them.

"We have prepared a draft of the resignation letter, which has been circulated among our members, and it would be shot off to the NCDEX as early as possible," said a committee member from Unjha on condition of anonymity.

An NCDEX press release clarified that no committee member had resigned, as reported in a section of the media, and added that the members had confirmed their participation in the Tuesday's meeting.

A product committee plays a dynamic role in drafting contract specifications and preparing trading norms, keeping in mind the margins and other benefits for the exchange.

The resignation of the committee members may hit the NCDEX as most of the members are active traders, who generate huge revenues for the exchange.

The present committee consists of 16 members "� one from Delhi, three from Jaipur, one from Mumbai, one from Nagore, one from the MDH group and the remaining are traders from Unjha.

A senior NCDEX official, however, categorically rejected the claim, arguing that no decision on jeera was taken without the committee's approval.

Another NCDEX official said that some inactive members of the committee needed to be replaced with new and dynamic members. They were hence unnecessarily making an issue, where none existed.

Questioning the competence of the National Collateral Management Services (NCMSL), an associate of the NCDEX, a trader alleged that the NCMSL lacked expertise and adequate equipment to test and certify agri commodities.

The NCMSL is responsible for assaying goods before accepting them for delivery. The exchange confirmed that it had received complaints from the Unjha traders of their deliveries being rejected by the NCDEX-accredited warehouses.

An NCDEX team had visited Unjha along with the NCMSL officials and examined the jeera stocks. Most of the jeera delivered did not conform to the contract specification, the press release added.

The traders are also perturbed over the margin requirements, which were raised to 30 per cent for the January-April season from 10 per cent earlier.