Other benefits available to
the farmers are :
- Seasonality of the crop forces farmers to sell at low prices during
the season. This can be avoided as farmers
stagger their sale to any or all of the future contracts in IPSTA at the best price
available.
- Intermediaries can be avoided and so also their commission.
- The existence of a futures market helps in providing long-term
stability in prices, providing farmers the utility of a
healthy market.
- If short-term need for funds arise, the farmer can sell small
quantities in the spot market and at the same time
square of his future position to that extent.
 
TRADING PATTERN IN IPSTA DOMESTIC DIVISION
:
- Trading takes place according to bye-laws, rules and regulations of
the Association.
- The Bye-laws, rules and regulations are distributed to all members
free of cost or can be purchased from the office
of the Association for a fee of Rs.100/- for outsiders.
- 12 Contracts are traded, one for each calendar month.
-
All pepper futures contracts are fully guaranteed by IPSTA leading
to no risk by default. For this purpose, a Trade Guarantee Fund
has been set up.
- The members can trade directly
on the trading floor or through registered brokers of the
Association.
-
A laga of Rs.2/- and Guarantee Fee
of Rs.5/- per transaction are collected by the Association.
-
Unit of trading is 10 quintals (1
tonne) on which an advance margin of Rs.8,000/- is collected by
IPSTA.
- Daily clearing
(mark-to-market) allows members to collect/disburse their net
profits/losses daily through the exchange, as per variation in
prices.
-
The open position at the end of
the contract results in actual physical delivery.
-
Malabar Garbled Black
Pepper grade is traded for each calendar month.
-
For Malabar Garbled
Black Pepper grade shall be, well dried with permissible mould up
to 1%; free from oil wash; with light pepper permissible up to 2%;
with extraneous matter such as bran, chaff, stalks and stones
permissible up to 0.5%; and moisture permissible up to 11% with a
tolerance of 0.5% during monsoon.
-
The position limit
per member is restricted to 3000 quintals (300 tonnes). However,
this limit is not applicable to genuine hedgers who submit
documentary proof of hedging.
-
The exchange puts a
restriction of Rs.400/- per quintal on the daily price fluctuation
as compared with the previous day’s closing price.
-
Special margins are
collected over and above other margins when the price moves above
or below a certain price band.
-
On-line trading will start shortly. Members/Registered Non Member
Clients can then trade from anywhere in the world with the help of
proper authorisation and passwords.
HOW TO BECOME A MEMBER IN IPSTA DOMESTIC
DIVISION ?
- An application form has to be filled and
submitted.
- Two existing members of the exchange have to propose and second the
new applicant.
- A bank confidential statement has to be submitted stating the
credibility of the applicant in the specified format.
- Applicants have the option of
executing specific power of attorney to authorize representatives
to trade and otherwise deal on behalf of the member.
- A mailing address in Cochin is required.
- A one-time admission fee of Rs.15,000/- and Guarantee Fee of
Rs.50,000/- is charged.
- The annual subscription is Rs.1000/-
- A security deposit of Rs.500/- is collected
which is refundable.
- The request for application form is attached.
< DOWNLOAD/REQUEST ADMISSION FORM >
HOW TO BECOME A NON-MEMBER CLIENT IN IPSTA DOMESTIC
DIVISION ?
< DOWNLOAD/REQUEST ADMISSION FORM >
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