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TMI BlogPosition Limits for Agricultural Commodity DerivativesX X X X Extracts X X X X X X X X Extracts X X X X ..... that current numerical limits applicable for agricultural commodity derivatives are inadequate and not in consonance with the deliverable supply of the commodity. This circular is hereby issued in continuation of the abovementioned SEBI circular with an objective to outline a principle based methodology for revising the commodity-wise numerical value of overall client level open position limits for agricultural commodities with reference to the 'deliverable supply' of the such commodity available in the country during any specific year. 3. After due consultation with various stakeholders and on the basis of recommendations of CDAC (Commodity Derivatives Advisory Committee), following framework is hereby being prescribed for dete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n + Imports 3.3. Client Level Numeric Position Limits : Numerical value of overall client level open position limits for each commodity shall be calculated from 'deliverable supply' available in a particular year, as per its category as given below: Category of Commodity Position limits Broad 1% of the deliverable supply Narrow 0.5% of the deliverable supply Sensitive 0.25% of the deliverable supply 3.3.1. The numbers arrived based upon above formula should be rounded off downward to appropriate number of zeroes. 3.4. Yearly Categorization of commodities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ricultural commodities. 3.4.4. Every year, for each agricultural commodity that is being traded in the derivatives market, all national commodity derivatives exchanges shall jointly complete the exercise of determination of deliverable supply, categorization/re-categorization of commodities and computation of numerical value of position limits. Numerical values of position limits for any agricultural commodity shall be revised only if the computation results in a revision in the value by at least 5% compared to previous year's limits. Exchanges shall, after prior intimation to SEBI, notify such details to the market through their respective websites sufficiently in advance and latest by 31st of July (unless extended by SEBI under ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion limit on open interests hall be 50% of its 'deliverable supply' determined for the relevant year, which shall also be jointly notified by Exchanges along with client level numerical limits. 6. Clubbing of position limits : Broad guidelines for clubbing of open positions have been prescribed vide Para 6 of SEBI Circular dated September 27, 2016. In this regard all national commodity derivatives exchanges are directed to jointly formulate a uniform guidelines and disclose the same to the market within 30 days from the date of this circular. 7. There is no change in norms with regard to near month position limits, computation of open positions, monitoring of position limits or any other norm earlier prescribed by SEBI fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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