Later, MCX informed that it is in process of modifying the cotton contract specification and no fresh position would be permitted in cotton January 2023 contracts and the subsequent expiry contracts till such time the revised contract specification gets finalised.
In its letter to Sebi on Monday, CPAI said the current contract will expire on December 30, 2022, and will move into the delivery period five days before the expiry.
The market participants and hedgers need to roll over the position into January 2023 onwards contract.
The market participants are awaiting the notification for the modified contract specification.
“Delay in the notification is only causing disquiet and uneasiness in the cotton industry and the derivatives market participants,” the association said.
Accordingly, it has suggested the Securities and Exchange Board of India (Sebi) to facilitate the conveying of the contract specification for an international referenceable commodity, cotton, at the earliest.
CPAI also said the daily price limits on the Indian cotton contract should not be restrictive in the modified contracts. It should not be kept too narrow that it keeps the participants away from the exchange ecosystem.