Cotton

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Cotton and Kapas Futures Multi Commodity Exchange of India Ltd.

Cotton and Kapas Futures

Introduction

Cotton

The Forward Markets Commission (FMC), Department of Consumer Affairs, Ministry of Consumer Affairs Food and Public Distribution, Government of India, is the regulating authority of all Futures Trading in Commodity Futures Exchanges in India. The Government of India has removed restrictions on futures trading in almost all commodities under the Forward Contracts Regulation Act (FCRA), which include agricultural commodities, industrial commodities, bullion, base metals and now energy. Multi Commodity Exchange of India Ltd. (MCX), with the permanent recognition from FMC, Government of India has established a demutualised Nation-wide Multi Commodity Online Exchange for Futures Trading in all the important and essential commodities. MCX is an ISO 9001:2000 certified exchange.

MCX highlights are as follows Key Shareholders: Financial Technologies (India) Ltd. State Bank of India National Stock Exchange of India Ltd. (NSE) National Bank for Agriculture and Rural Development (NABARD) HDFC Bank Bank of Baroda

Bank of India Union Bank of India Corporation Bank Canara Bank State Bank of Indore Bank of Hyderabad Bank of Saurashtra SBI Life Insurance Corp.

Neutrality - the greatest asset Strong management team with deep domain expertise Over 1000 members from 500 cities across India Industry experts spearheading the Advisory Board Best intermediaries and support agencies Strategic alliance with prominent industry associationsBombay Bullion Association (BBA), Bombay Metal Exchange (BME),Solvent Extractors Association (SEA), Pulses Importers Association (PIA), The United Planters’ Association of Southern India (UPASI), India Pepper and Spice Trade Association (IPSTA) Competitive membership fee structure and operational cost Optimally priced state-of-the-art technology solutions Transparent and fair system of automated order matching and online market information Daily mark to market, real-time price and trade information dissemination Robust risk management system and controls International Alliances : MCX has signed MOUs with world’s leading commodity exchanges like The Tokyo Commodity Exchange (TOCOM),The Baltic Exchange-London, Chicago Climate Exchange (CCX) and New York Mercantile Exchange (NYMEX). MCX & Financial Technologies (India) Ltd. (FTIL) in association with DMCC, a strategic initiative of Government of Dubai, has entered into a 50:50 Joint Venture to set up the Dubai Gold & Commodities Exchange (DGCX)

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Cotton and Kapas Futures

© Multi Commodity Exchange of India Ltd.

Cotton is one of the most important fiber constituting more than 37% share in total fiber usage The world consumption of textile fibers has gone up to some 50 million tons now from 15 million tons in 1960. At present the average per capita annual consumption of textile fibers in the world is about 8 kg of which 3 kg is cotton

Occurrence of price variation in percentage terms in Mumbai Month on month variation in % terms Average prices of J-34 (S.G.) Cotton between 1995-96 to 2001-02

0–2

2-5

5 & above

38

29

34

Maximum Price Variation in Percentage Terms Maximum Variation Monthly Year

Percentage 12.4 21

Average prices of J-34 (S.G.) Cotton between 1995-96 to 2001-02. Source: East India Cotton Association Ltd, Mumbai Cotton - Global Scenario The biggest cultivators of cotton are China, USA, India, Pakistan, Brazil, etc. China, US and India are the three largest producers of cotton. However, of them only US is having considerable share in the world exports. India and China both fall short of their domestic requirement and are net importers Among the consumers China leads the way being followed by India, EU, C-EVR & Turkey, Pakistan According to some estimates, share of GM cotton in total cotton output may go up from 30 percent at present to 50 percent in 2005 The annual opening and closing stock of the cotton provide considerable cushion against succeeding years crop failure World Demand & Supply Situation Year Beginning August 2005 World Beginning stock World Cotton Production World Cotton Consumption World Cotton Exports World Ending stocks

Quantity in million Metric tons 04-05 04-05 8.11 10.39 26.20 24.40 23.40 23.93 7.65 8.09 10.39 10.86 Source: ICAC Release

Important World Cotton Markets New York (NYBOT), largest Cotton futures market China, Cotton trading started in 2004 at Shanghai commodity Exchange © Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures

Major Indian Markets

Indian Scenario India is the third largest producer of cotton in the world with production of around 3.95 million MT (Approximately 13% of world Production) Area under cotton is around 9.50 million hectares contributing about 21% in world share and keeps fluctuating owing to monsoon and other factors Despite having the largest area under cotton in the world, India ranks third in world output of cotton due to its abysmally low average yield of 415 kgs against a world average of 723 kgs per hectare Cotton is cultivated in almost all the states in the country, the 9 states of Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Madhya Pradesh, Andhra Pradesh, Tamil Nadu and Karnataka account for more than 95 percent of the area under output In India cotton is sown during March to September and harvested during September to April. The peak marketing season for the crop is during November to March. At present about 40 percent of the 5 million hectares of total area under cotton in India is under hybrid cotton The country has to import about 12 lakh bales of cotton equivalent to 5.00 percent of the domestic production due to price and quality considerations The production is highly dependent on the monsoon and fluctuates between years In India, every year, the output of cotton is estimated by the ministry of agriculture and the Cotton Advisory Board (CAB) In India more than 80 percent of the cotton produced is sold out by March 31 every year and the price starts firming up from April and starts easing only in September when the new crop starts arriving in the market The major cotton consuming segments are the mills and the small-scale industry. Their main considerations are for quality and price of cotton. However, falling yield leading to high cost of production and falling quality (varietal purity & trash content) are driving the domestic consumers to go for imported cotton Indian Demand & Supply Cotton Year: October to September Quantity in lakh bales of 170 kgs.

Supply Opening Stock Crope size Imports Total Availability Demand Mill Consumption Small Mill Consumption Non-Mill Consumption Total Consumption Exports Total Disappearance CARRY FORWARD

2003-04 24.00 179.00 7.21 210.21

2004-05 21.00 243.00 12.00 276.00

150.39 13.00 13.71 177.10 12.11 189.21 21.00

163.00 17.00 14.00 194.00 10.00 204.00 72.00

Source: East India Cotton Association

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Cotton and Kapas Futures

© Multi Commodity Exchange of India Ltd.

Adilabad, Karim Nagar, Khammam, Dhule, SurendraNagar, Bhavnagar, Sriganganagar, Bhatinda, Hisar, Sirsa, Guntur, Kurnool, Coimbatore, Gulbarga, Ahmednagar, Akola, Sangli, Kota, Mumbai are major trading centers. Factors Influencing Cotton Markets Weather at all the producing centers. The boll-setting period, being the most crucial The area planted, determined by the price of Cotton and timely onset of monsoon Pests and diseases attacks and its intensity of damage The supply-demand and international price scenario Growth of textiles and Garment sectors Conversion 1 1 1 1

candy = 2.11538 bales = 359.615 Kg bale = 170 Kg pound = 0.4536 Kg Mon of Kapas = 20 kg

Web Resources www.futuresource.com www.fsxtra.com www.ers.usda.gov www.indiancommodities.com

www.dowjones.com www.fas.usda.gov www.commodityindia.com www.eagritrader.com

MCX Trading Multi Commodity Exchange of India Ltd., established in 2003 and already the largest futures multi commodity exchange in India, provides the premier forum for managing the price risk associated with cotton and kapas market. MCX is already a dominant center for gold and silver futures trading. MCX’s liquidity, price transparency and financial integrity make it a benchmark for commodity future markets in this part of the world. Orders are entered through MCX Trader Work Station terminals A credit–controlled module verifies credit worthiness based on clearing–member predetermined parameters Orders are matched on price and time priority Matched orders are confirmed at each originating terminal. Meanwhile, all unmatched orders remain in the system until matched or withdrawn The instant a trade is executed, all participating quote vendors receive last sale price and quantity data, as well as updated information on best bid, offer and size of each order © Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures

Cotton and Kapas Futures

As each trade is confirmed, it is routed to the MCX clearing system for settlement

Cotton producers, merchants and stockist face risk of large value losses on their production, purchases and stocks from fall in prices. Similarly the exporters and spinners are exposed to heavy risks from adverse price increases on their overseas or domestic sale commitments of fiber or yarn for delivery at a later date. Futures trading in cotton are likely to give an effective tool in their hand to hedge their price risk.

Clearing member firms adjust buyers and sellers accounts for positions and margins MCX Clearing and Settlement The clearing house of the MCX ensures and guarantees the settlement of all net settlement liability between the MCX’s Clearing member firms. Daily Settlement (Pay-in and Pay-out) MCX has daily settlement of all transactions conducted on the Exchange. This process begins with the computation of closing price at the end of the trading day at which all positions are marked to market and carried forward to the next day. This closing price is also called the settlement price, which is calculated for each futures contract. Once established, the settlement price is used for all new and open (un-liquidated) positions to compute the pay-in and payout. The losses and profits of each member is computed at the end of the day and then collected/ paid next day morning electronically from/ into the bank account of the member. In case of default the trading of the member is suspended based on the rules of the exchange.

Introduction of cotton futures is also likely to improve the cotton quality (by improving varietal purity and reduce trash content) to comply with the quality specifications of the underlying as traded in the exchange. Trading on MCX provides number of advantages The contracts are standardized by quality and quantity, widely accepted and therefore are liquid financial instruments MCX offers cost efficient trading and risk management opportunities Contracts are traded online on a real time trading platform of MCX, representing a confluence of opinions on future values and resulting in price transparency and best price discovery MCX Long staple cotton, Medium Staple Cotton and Kapas futures prices are widely and instantaneously disseminated, serving as a ready reference price for the entire cotton trading community

Delivery / Cash Settlement

MCX allow hedgers and investors to trade anonymously through futures brokers, who act as independent agents for traders

Traditionally taking an offsetting position fulfills contracts. (Thereby avoiding giving or taking delivery). But when open contracts run into the delivery period, then contracts are initiated for a delivery.

The depth of the market allows the contracts to be easily liquidated prior to required receipt or delivery of the underlying commodity

The seller has the option in tendering a delivery and seller initiates the delivery process on the First Notice Day of the delivery period. However when neither the seller nor the buyer has intended to give or take delivery, then those open contracts on the expiry day of the contract are cash settled at the due-date rate of the contract. Due-date rate is the average of the last 5 days closing in the spot market of the underlying commodity and the futures contract, which ever is higher.

While futures contracts are seldom used for delivery, if delivery is required, performance is guaranteed. Counter party risk is absent from transactions executed on the Exchange Contract performance in the cotton and Kapas futures is supported by a strong financial system, backed by MCX learing members MCX offers safe, fair and orderly markets protected by its rigorous financial standards and surveillance procedures

Why trade MCX Cotton and Kapas Futures? Importance of Indian cotton industry in World markets and exposure to global market make it essential to have price risk management tools. Especially after WTO provision and end of quota regime in textiles sector it is desirable. Cotton future at MCX Platform is an important risk management tool for commercial interests as well as an exciting potential opportunity for those investors who seek to profit by correctly anticipating price changes.

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© Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures Bullish Scenario

Futures Futures contracts are firm commitments to make or accept delivery of a specific quantity and quality of a commodity during a specific month in the future at a price agreed upon at the time the commitment is made. It is observed globally that Approximately 1% of futures contracts traded result in delivery of the underlying commodities. Instead the traders generally offset their futures positions before their contracts mature. The difference between the initial purchase or sale price and the price of the offsetting transaction represents the realized profit or loss. Hedging Futures contract have been used as financial offsets to cash market risk for more than a century. Hedging allows a market participant to lock in prices and margins in advance and reduces the potential for unanticipated loss or competitive disadvantage. A hedge involves establishing a position in the futures market that is equal and opposite to a position in the physical market. For instance a Cotton traders who holds 1 ton of cotton will hedge by selling (going short) on 1 ton of cotton contract. The principle behind establishing equal and opposite positions in the cash and futures markets is that a loss in one market should be offset by a gain in the other market. Hedging works because cash prices and futures prices tend to move in tandem, converging as each delivery month reaches expiration. Hedging Example - 1 In August 2004, Mr. Tapan Desai, Rajkot based Cotton traders receives order to deliver Medium Staple Cotton of 130 candy in November 2004. However in November Medium Staple Cotton price is expected to rule low. To protect himself from downward price movement he decides to trade in MCX platform to hedge this price risk. In August 2004, he sells 5 contracts (26 candy each) of MCX Medium Staple contract at Rs. 21600 per candy. He pays suppose only 3 % of the total value as good will deposit (margin) with the exchange. Bearish Scenario

By November 2004, the futures prices rise to converge with spot market at Rs. 22100 per candy. Spot Market

Futures Market

August 2004

Sells Nov’ 04 contract at Rs. 21600 per candy

October 2004 Sells at Rs. 22100 per candy

Buys Nov 04 contract at Rs. 22100 per candy Profits Rs. 600 per candy Losses Rs 600 per candy Transaction resulted in no profit no loss Hedging Example - 2 In August 2004, Pankaj Cotton Mills Ltd. enters into a forward trade to import 260 candy of Long staple cotton from USA. The delivery is scheduled in November 2004. To protect itself from upward price movement the company decides to trade in MCX platform to hedge this price risk. In August 2004, it buys 10 contracts (26 candy each) of MCX Long Staple cotton November contract at Rs. 22380 per Candy. It pays suppose only 3 % of the total value as a good will deposit (margin) with the exchange, which in other case it had to pay the entire amount upfront in the spot market. Bullish Scenario By November 2004, the futures prices rise to converge with spot market at Rs. 23200 per candy. Spot Market

Futures Market

August 2004

Buys Nov 04 contract at Rs. 22380 per Candy

November 2004 Receives his stock at Rs. 23200 per Candy Losses Rs. 820 per Candy Transaction resulted in no profit

Sells Nov 04 contract at Rs. 23200 per candy Profits Rs 820 per candy no loss

Bearish Scenario

By November 2004, the futures prices fall to converge with spot market at Rs. 20800 per Candy. Bearish Scenario Spot Market August 2004

Futures Market Sells Nov ‘04 contract at Rs. 21600 per candy

November 2004 Sells at Rs. 20800 per candy

Buys Nov ‘04 contract at Rs. 20800 per candy Losses Rs. 800 per candy Profits Rs 800 per candy Transaction resulted in no profit no loss

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Cotton and Kapas Futures

© Multi Commodity Exchange of India Ltd.

By November 2004, the futures prices falls to converge with spot market at Rs. 21970 per Candy. Spot Market

Futures Market

August 2004

Buys November 04 contract at Rs. 22380 per Candy

November 2004 Receives his stock at Rs. 21970 per Candy Profits Rs. 410 per candy Transaction resulted in no profit

Sells Nov 04 contract at Rs. 21970 per candy Losses Rs 410 per candy no loss

© Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures

Cotton and Kapas Futures

Speculation

Cash v/s Futures Prices Relationship

Speculators accept the risk that hedgers seek to avoid, giving the market the liquidity required to service commercial hedge participants effectively by providing the market with the necessary bids and offers to implement a continuous flow of transactions.

In general, futures markets compensate an individual for the cost of purchasing a commodity today, storing it and delivering it in the future. As a result, one would ordinarily expect to see an upward trend in prices as contract months go further out. Such a condition is known as Contango and is typical of many futures markets. However, in cotton the flows of demand and production are not synchronized. Stored inventories absorb demand fluctuations in periods between production times. There is a likelihood of shortage in the physical market and peak arrival months in the future. This may cause the spot price to rise above the futures price between production times. Backwardation, is a condition in which spot price is lower than futures or the futures price is lower in the distant delivery months than in the near delivery months.

Speculation is the opposite of hedging. A speculator holds no offsetting cash market position and deliberately incurs price risk in order to reap its potential reward. Speculation Example In August 2004, Mr. Sunder an expert in cotton industry thinks that price of Medium Staple Cotton is expected to move up by November 2004. He has idle cash of Rs. 50,000 by which he can buy only 2 candy of Medium Staple Cotton from the spot market based on the ruling price of Rs 21000 per candy. He is not interested to take physical delivery. He buys 3 contracts (26 candy) of Medium Staple Cotton Nov 04 contracts on MCX platform. He can enjoy a leverage of 25 times as he has to keep a good will deposit (margin) of suppose only 3 % (Rs 50,000) with the exchange. The Medium Staple Cotton futures prices actually move according to his anticipation and rule at Rs. 22380 per candy in November 2004, which gives him a profit of Rs. 1,07640 on his 78 candy buy position in futures which he squares off by selling in MCX.

Margin Requirement Multi Commodity Exchange of India Ltd requires its members to deposit and maintain in their accounts a certain minimum amount of funds for each open position held. These funds are known as margin and represent a good faith deposit that serves to provide protection against losses in the market. The Clearinghouse collects margins directly from each of MCX clearing members who in turn are responsible for the collection of funds from their clients. Margin requirements and contract specifications are subject to change. Please contact the Exchange or your broker for current information. Market information Services

Case 1 –

Case 2 –

Buy in Spot Market

Buy in Futures Market

Aug 2004 Buys 2 candy of Medium Staple Buys 3 contracts (78candy) of Cotton valued at Rs. 42,000 Nov 04 Medium Staple Cotton valued at Rs.1638,000 at Rs.21000 per candy, with a goodwill deposit of 50,000 with MCX October 2004 Sells 2 candy of Medium Staple Cotton valued at Rs. 44,760

Profits Rs. 2760

Sells 3 contracts (78 candy) of Nov 04 Medium staple Cotton at Rs.22380 per candy valued at Rs.1745640 Profits Rs. 107640

Thus by correctly anticipating Medium Staple Cotton price movement, Mr. Sunder could enjoy a leverage of 39 times by investing his capital in Medium Staple Cotton futures market instead of buying physical Medium Staple Cotton in the spot market.

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Phone System: MCX’s information service department makes available information available one hour prior to start of trading and one hour after end of trading, on the number (022) 56494000 Internet Access: MCX Home page at http://www.mcxindia.com, provides regular trading and settlement information, including daily open, high, low, close, volume, open interest of futures contracts traded, as well as contract specifications, MCX announcements etc. Price, Volume and Open Interest Histories Relevant histories for all exchange-traded contracts are available on MCX website and the same is also available on contacting the exchange at: [email protected] Quote Service MCX’s daily futures quotations are widely disseminated by data vendors around the world. The details are available on the MCX website.

© Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures

Cotton and Kapas Futures

Commodities Available on MCX for trading Basmati Rice Black Pepper Brent Crude Oil Cashew Kernel Castor Oil Castorseed Chana Copper Cotton Long Staple Cotton Medium Staple Cottonseed Oil Cake Crude Oil Crude Palm Oil Gold Gold HNI Gold M Groundnut Oil Guar Seed Guargum Gur Jeera Kapas Maize Masur Mentha Oil

Mustard Oil Mustard Seed Nickel Polypropylene (PP) High Density Polyethylene (HDPE) RBD Palmolein Refined Soy oil Rice Rubber Sarbati Rice Sesame seed Silver Silver HNI Silver M Soy Seed Soymeal Steel Flat Steel Long Sugar Tin Tur Turmeric Urad Wheat Yellow Peas

To receive MCX Comnews (monthly news letter) kindly send a mail to [email protected]

COTTON - LONG STAPLE CONTRACT SPECIFICATION Trading unit

55 bales (26 candy approx)

Quotation/Base Value

Rs./Candy

Quality Specifications Basis variety

28.00 to 28.99 mm

Deliverable with discount

27.00 to 27.99 mm (With Discount of Rs 700 per Candy)

Deliverable with premium

29.00 to 29.99 mm or above (With Premium of Rs 500 Per Candy)

Rejectable at buyer’s option

Below 27.00 mm

Sawginned quality.

No premium

Micronaire Basis variety Acceptable with discount

Rejectable at Buyer’s option

3.00-4.00

Acceptable

Below 3 ( 1% Premium)

Acceptable Rejectable at buyer’s option

4.01-5.00 ( 1.5% Discount)

Strength Rejectable at buyer’s option

21 GMS per TEX at 1/ 8 gauge

Moisture Basis

550 Bales Rs. 10

Daily price limits

2 %

Price Quote

Ex- warehouse kadi (excluding all taxes)

Rejectable at Buyer’s option

For a client: 5500 Bales For a member collectively for all clients: 25 % of the open position of the market at any point of time

Other Condition :

Delivery 55 bales (93.5 quintals) - 26 candy approx

Delivery center(s)

Kadi, Rajkot, Akola, Nagpur, Sendhwa, Burhanpur, Warangal, Adilabad, Coimbatore

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Below 3.2 and above 4.5

Trash Basis

Tick size (minimum price movement)

Delivery unit

to 4.2 (Rs 100/ Candy) (Rs 200/ Candy) (Rs 300/Candy)

4.3 (Rs 100/ Candy) 4.4 ( Rs 200/ Candy) 4.5 (Rs 300/ Candy)

Maximum order size

Maximum Allowable Open Position

3.5 3.4 3.3 3.2

Acceptable with penalty

Higher than 5

Below 21 8.5 % maximum 8. 5 % to 9. 5 % ( With Penalty of 2%) 9.5 % to 10.5 % ( With Penalty of 4%) Above 10. 5%

1. Only current season Indian crop (October to September) is deliverable. 2. Re-tendering of goods delivered in earlier contract on subsequent contracts would attract Rs. 50 per Candy discount to the tenderer per subsequent contract. For example, if cotton delivered in November 2004 contract is re tendered in May 2005 contract, then the amount of discount would be Rs. 150 per candy. Out of this, 90% would be passed on to the buyers and 10% would be appropriated by the Exchange. © Multi Commodity Exchange of India Ltd.

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Cotton and Kapas Futures COTTON - MEDIUM STAPLE CONTRACT SPECIFICATION Trading unit 250 Maund (55 bales) (1 maund = 37.324 kg) COTTON - SHORT STAPLE (V-797/G-13) CONTRACT SPECIFICATION Trading unit 24 Candy (50 bales approx) COTTONSEED CONTRACT SPECIFICATION Trading unit 10 MT KAPAS CONTRACT SPECIFICATIONS Trading unit 4 MT Quotation/Base Value 20 Kg Maximum order size 100 MT Tick size (minimum 10 paise per 20 Kg price movement) Daily price limits 1.5 % Price Quote Ex-Surendranagar (excluding all taxes). Maximum Allowable For individual clients: 20000 MT Open Position For a member collectively for all clients: 25% of the open market position Delivery Delivery unit 4 MT (200 mons) Delivery center(s) (1) Within the municipal limits of Kadi, Viramgham, Lakhtar Limdi and Bawla (2) Within 50 Kms of municipal limits of Surendranagar Quality Specifications Variety Fair average Kalyan Cotton of Gujarat 13 variety and / or V / 797 variety, which can be either hand made or machine made. Delivery standards Unginned and unpressed Raw Kapas bundled as per specifications given by MCX. Bandhani or Price The contract would have a price Ceiling / Floor limits for ceiling of Rs.90/- for the life time the life of the contract of the contract over and above the base price and similarly a floor limit of Rs.90/- below the base price. The base price of the contract is fixed at Rs.345/- for the contract over which the price limit of Rs.90/- would apply. Quality Certification Delivery Samples must be certified by surveyors approved by MCX Proportion of Cotton: Seed in the Kapas shall be 40:60. If the ratio of Cotton is within 2% tolerance limit (between 38% to 42%), it is acceptable without any premium or discount. If the proportion of cotton is more than 42%, the seller would get a proportionate premium for every percentage. If the proportion of cotton is less than 38%, the seller would be subject to a proportionate discount for every percentage. If the percentage is below 36%, it is rejectable at buyer’s option.

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© Multi Commodity Exchange of India Ltd.

Cotton and Kapas Futures Refraction will be acceptable upto 20 Kg per 4 MT of Kapas Bandhani or Price ceiling floor limits for the life of the contract. Price ceiling of Rs.90/- over and above the base price. The base price of the contract is fixed at Rs.345/-.

KAPASIA KHALLI / DHEP CONTRACT SPECIFICATION Trading unit Quotation/Base Value Maximum order size Tick size (minimum price movement) Daily price limits Price Quote Maximum Allowable Open Position

Delivery unit

Delivery center(s)

5 MT 50 kg 500 MT 10 paise 3 % Ex- Akola exclusive of all taxes, sales tax/VAT, if applicable For a client: 30000 MT For a member collectively for all clients: 25 % of the open position of the market at any point of time Delivery 50 MT (with tolerance limit of 1MT) which means that is the seller delivers any quantity between 49 MT to 51 MT, it will be construed as adequate discharge of his delivery obligation of 50 MT, though he will get the Value only for actual quantity delivered byhim W ithin 30 kilometers of Akola Municipal Limits

Quality Specifications/Deliverable of grades Good quality of Akola Undecorticated Cottonseed Oilcake/Kapasia Khalli (Dhep), 50 kg full Katta Bardana OA (Oil & Albuminoides) Moisture content Basis Acceptable Rejectable at buyers option Sand/Silica Maximum To be Accepted Rejectable at Buyers option Fibre Maximum Colour Oil content Other Conditions

20% Minimum 10% Maximum Between 10% - 12% with allowance 1:1 Above 12% 2.5% Between 2.5% - 5% with allowance 1:1 Above 5% 28% Yellow and Green Above 6% There should not be any mixing. It should be 100% cottonseed oilcake.

Note: Kindly refer the exchange circulars for the latest contract specifications and Delivery & Settlement Procedure. © Multi Commodity Exchange of India Ltd.

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Trade with Trust

Multi Commodity Exchange of India Ltd. 102 A, Landmark, Suren Road, Chakala, Andheri (East), Mumbai - 400 093. Tel.: 022-56494000 Fax: 022-56494151 Email - [email protected] www.mcxindia.com

Disclaimer: This brochure has been prepared for general information purpose only. While the Exchange has made every effort to assure the accuracy of the information contained herein, any affirmation of fact in this brochure shall not create an express or implied warranty that any example or description is correct. This brochure is made available on the condition that errors or omissions shall not be made the basis for any claims, demands or cause of action.