The December 2022 futures contract that expired on December 30 was the last cotton futures contract available to traders. The Securities and Exchange Board of India (SEBI) banned new contracts in August 2022 for revision.
The SEBI had approved Multi Commodity Exchange (MCX) to launch a revised cotton contract but it could not launch it by the end of 2022. The committee comprising various stakeholders including representatives of the textile industry discussed the modalities of new contracts. The textile industry blamed the futures contracts as the main reason for the unusual rise in cotton rates. The SEBI then decided to discontinue further future contracts and left it to the committee to relaunch new contracts with revised specifications.
AÂ source in the committee confided to the Textalks that modalities for the new launch have been finalized and SEBI has also granted its approval. He said the MCX would now launch a new contract after factoring in the conditions of the contract draft approved by the SEBI. He said no further official approvals are needed in this regard.
The calendar for cotton (29mm) February, April, and June 2023 contracts that were supposed to be launched in December ’22 will now be launched probably in January 2023 will to be launched in December 2022, but they may come in January 2023. The last contract of the current cotton season (October 2022-September 2023) for August 2023 will be launched in February 2023. The rest of the schedule would be as per normal routine.
