Published On: Wed, Jul 20th, 2011

TGE Launches Rice Futures

The Launch date for Rice futures will be on August 8, 2011 starting from the Day Session.

The rice futures contract will start trading with 3 contract months- the November 2011, December 2011 and January 2012 contract months.

Rice Futures Contract Specification

Standard Grade
Nonglutinous brown rice in the current crop year with grade 1 criteria that has been product tested as specified under the Agricultural Products Inspection Act (net weight of 30kg of rice packed in a paper bag) and is capable of providing recorded information on production based upon the Rice Traceability Act. Kanto Plain Koshihikari (produced in the Ibaraki, Tochigi and Chiba prefectures)

Deliverable Brands
Koshihikari (produced in the prefectures of Ibaraki, Tochigi, Chiba, Fukushima (Aizu), Fukushima (Nakadoori), Fukushima (Hamadoori), Niigata, Toyama, Ishikawa, Fukui and Nagano).

Hitomebore (produced in Iwate and Miyagi prefectures), Akita Komachi (produced in Akita prefecture), Yamagata Haenuki, Hokkaido Nanatsuboshi, Kirara 397 Aomori Tsugaru Roman and Aomori Masshigura.

Total of 19 brands

Contract Unit – 60kg (1 hyo= 2 bags)
Minimum Fluctuation – JPY10 per 6,000kg (100 hyos/200 bags)
Trading Hours – Day Session 09:00-15:30; Night Session 17:00-19:00
Delivery Unit – 12,000kg (200 hyos/400 bags)
Contract months – Consecutive 6 months
Last trading day – 20th of each spot month (20th of every month)
Delivery Day – 5 business days following the last trading day

Delivery points
1) Exchange designated warehouses in the Tokyo, Kanagawa prefecture, Saitama Prefecture, Chiba Prefecture, Ibaraki prefecture and Tochigi prefecture areas.
2) Delivery points that are agreed upon by the parties taking/making delivery.

Delivery method
1) Warehouse Receipts
2) Procedures agreed upon by the parties taking/making delivery (delivery orders)

Delivery System
1) Basic delivery- Delivery where both parties of the delivery exchange warehouse receipts and delivery price on the delivery day
2) Delivery by agreement through both parties making/taking delivery (Early delivery, Agreed delivery)

Parties taking/making delivery on the physical market may exchange (swap) their position for futures positions of similar terms on the Exchange to provide confirmatory evidence. (Exchange for Physical EFP transactions will be implemented)

Claim procedures
1) Items subject to claims (Quality (colored grains, foreign odors such as mold, etc., moisture, fissures in the grains etc.) lack of weight, packaging and others (such as cadmium and other pesticide residue).
2) Period to apply for claim: From the delivery day up to 14:00 on the 5th day from the delivery day.
3) The “Delivery Inspection Committee” conduct inspection by analytic sampling and make a ruling. The ruling with be “accepted“, “accepted with discounts” or “rejected”.
4) System for request for prior inspection will be implemented.

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