NCDEX circular on Concentration Margin – Revision in Threshold Levels
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Highlights of the Circular :
Reference is made to SEBI Master Circular no. SEBI/HO/MRD/MRD-PoD-1/P/CIR/2023/136 dated August 04, 2023 on Master Circular for Commodity Derivatives Market and NCCL circular nos. NCCL/RISK-028/2025 dated June 09, 2025 on Concentration Margin – Revision in Threshold Levels and NCCL/RISK-022/2026 dated April 29, 2026 on Master Circular - Risk Management.
The Clearing Corporation has reviewed the thresholds for Concentration Margin purpose. The reviewed threshold level are provided in Annexure I.
The Concentration Margin on all the commodity contracts will be levied at clearing member level and client level based on the following criteria –
Clearing Member Level: The percentage share of a clearing member’s open interest to the market wide open interest in a given commodity.
The Concentration Margin would be applicable in respect of all contracts in the commodity unless specified otherwise and would be applicable as follows attached in the circular.
Client Level: The percentage share of client’s open interest to the market wide open interest in a given commodity.
The Concentration Margin would be applicable in respect of all contracts in the commodity unless specified otherwise and would be applicable as follows attached in the circular.
a. The Concentration Margin would be applicable at a specific client level and clearing member level for a particular commodity i.e. only those members/clients having OI that is eligible for charging of Concentration Margin as per the tables above. This margin shall be over and above all other margins as may be applicable.
b. The Concentration Margin corresponding to a slab would be applied only on the incremental open interest for that slab.
c. Concentration Margin would become applicable to commodities only when the overall market wide OI of a commodity exceeds the specified Threshold Level of OI for that commodity. The Threshold Levels for commodities are given in Annexure I.
d. Clients who hedge through a Hedge Code would be exempted from levy of Concentration Margin at the client level to the extent of positions held in the Hedge Code as notified by the Exchange from time to time.
e. As per SEBI Master Circular no. SEBI/HO/MRD/MRD-PoD-1/P/CIR/2023/136 dated August 04, 2023 Concentration Margin shall be levied on Eligible Foreign Entities (EFEs).
f. Higher concentration margins, if necessary, shall be specified by NCCL.
g. Members are advised to update themselves on the applicable list of narrow and sensitive agricultural commodities as may be notified from time to time. The list of the narrow and sensitive agricultural commodities is given in Annexure II.
The circular shall be effective from beginning of trading day June 01, 2026.
Members and participants are requested to note the above.