Commodity markets regulator FMC has reduced the margins by 50 per cent on all contracts of soyabean and mustard seed from today.
In a circular, the Forward Markets Commission (FMC) said that special margins of 10 per cent (in cash) on the long side of all existing contracts of soyabean and rapeseed/mustard seeds have been reduced to 5 per cent.
“The structure of special margin will come into effect from the beginning of trading day June 8, 2012, in all the running contracts and yet to be launched contracts,” the circular added.
In view of the recent trends in the prices of soyabean and rapeseed/mustard seed contracts, the commission has decided to revise the existing rate of special margin, FMC said.
Margin is a deposit that is required to be given by traders before entering into a pact to buy or sell the commodity at future date.
Soyabean contract for June was trading at Rs 3,429 per quintal at 11.15 am against the previous closing of Rs 3,420 a quintal on the NCDEX.
Mustard seed contract for June was trading down 0.67 per cent at Rs 3,706 a quintal at 11.30 am against the previous close of Rs 3,731 a quintal.
The regulator in April had reduced the open position limits — a restriction on the quantity of commodities that can be traded in the futures market — in soyabean, soya oil, mustard seed and chana to curb excessive price volatility.