NCDEX Spot launches delivery contract of black pepper

Mumbai: NCDEX Spot Exchange Ltd (NSPOT) is launching compulsory delivery contract of black pepper-garbled on its electronic platform from Friday.
At this moment, the contract is aimed at black pepper producers of Kerala but later Karnataka will also be included.
While the current contract is for garbled black pepper, the exchange would launch a separate contract of un-garbled pepper later.
"After successful launch of sugar in Maharashtra, this move will benefit the farmers of the Kerala immensely," R Ramasheshan, managing director and CEO, NCDEX said.
The delivery centre for the contract would be at Kochi with minimum trading lot of one tonne. All trades on the exchange are guaranteed by the exchange for delivery and payments. The tick size of the contract will be Rs 1 per quintal.
According to contract specifications, three level circuit filters has been designed for this contract. Once the first level of (+/-) 6% is hit, trading is halted for 15 minutes then the filter is enhanced by (+/-) 3% to create the second level. After resumption, if the second level is hit the trading is again halted for 15 minutes and the filter is enhanced further by another (+/-) 3% to create the third level. Incase the third level is also hit; trading is suspended for the day.
The contract will allow participants from all over the country to buy black pepper, thereby, enabling producers in Kochi to discover best price for their black pepper traded on the exchange platform. (source: Financial Express)