NATIONAL BOARD OF TRADE

LIMITED (NBOT)

NATIONAL BOARD OF TRADE LIMITED (NBOT) was incorporated

on July 30,1999 to offer integrated, state-of-the-art commodity futures
exchange. It was incorporated to offer transparent and efficient trading
platform to various market intermediaries in the commodity futures trade.
Today NBOT is one of the fastest growing commodity exchanges
recognized by the Government of India under the aegis of the Forward
Markets Commission. Within a short span of seven years, NBOT has carved
out a niche for itself in the commodities market. With a humble beginning of
trading in February 2000 its average daily volume has reached a staggering
60,000 MTs (approx.) in terms of Soya oil. It has implemented the state-of-
the-art technology and system for efficient handling of Trading, Margining,
Clearing and Settlement in respect of all the transactions confirmed by the
Exchange. The Board of directors, adorned by a galaxy of the most
respectful personalities drawn from different categories of trade and
commerce has been giving necessary impetus and thrust for setting up of the
exchange and provide guidance for its proper functioning.

NBOT has been constantly endeavoring to strengthen professionalism in

the commodities futures market and to provide credible nation-wide trading
facilities to market players in tune with the international standards.

CORPORATE PHILOSOPHY

NBOT Will be a catalyst for the development of the Indian Oilseeds

growers, trade and industry by providing the cost effective and efficient
services. In being so, NBOT's sphere of action will synergies and naturally
identify with the interests of NBOT members, the investors, the industry and
above all, the country. In all that we do, we will be fair, professional and
pre-eminent.
MISSION
To achieve high distinction in integrity for pricing, risk management and
investment to build an internationally acclaimed innovative Commodity
Exchange in India.

OBJECT
Futures Exchange helps to achieve dual economic purposes: Price
Discovery & Risk-Management.

The introduction of futures trading with the ability to buy and sell
commodities for future delivery helps make the price less volatile and, of
course, realistic in comparison to the cash market prices. Futures contract is
a contract of a specific quantity and quality of a given commodity at a
predetermined place and time in future with all terms of contracts
standardized excepting the price which is determined by the market forces.
At the time of expiration of the contract, the open position is either squared-
off or resulting in delivery.

Volatile trend in the price movement of oilseeds and their derivatives

often has a telling effect on the performance of the processors, growers and
other intermediaries. Futures Exchange tends to achieve a rational for price
discovery and data dissemination on real-time basis, which improves
hedging by minimizing speculative risk.

COMMODITIES
NBOT has been mandated to organize futures trading in the following
commodities:
(i) Soybean, its oil and cake;
(ii) Rape/Mustard seed, their oil and cake;
 (iii) RBD Palmolein, Crude Palm Oil, CPO Refined and Crude
Palmolein

MEMBERSHIP
The Exchange has 119 Business Members from all over India, out of whom
almost 80% are active. The composition of the Business Members is as
follows:-

(i) Trading Member ---- 056

(ii) Trading-cum-Clearing Member ---- 062
(iii) Institutional Clearing Member ---- 001

The Business Members represent various categories viz. growers,

processors, traders, brokers, importers-exporters and banker.

Trading System

NBOT has conceived and developed the trading, clearing and settlement
system, which are user friendly and functional under the fully computerized
environment. The trading takes place in the Ring Hall with an outcry system,
which will be replaced, in gradual phases through computerized
environment. All trades confirmed by the exchange are guaranteed for
performance.

Trading takes place from Monday to Friday between 10:00 a.m. to 5:00
p.m. and on Saturdays between 10:00 a.m. to 2:00 p.m. Trade shall have
priority strictly in the order of price, time, non-member client account and
own account. Trading limit for trading is fixed by clearing member, which is
subject to over-all limits fixed by the Exchange.

In order to ensure adequate safety for trades executed through the

Exchange, ceiling on trading by each member is fixed. There will be daily
clearing based on mark to market system; failure to clear the dues will result
in automatic closing out of open positions. Pre-margin requirements in case
a member exceed free trading limits.

On the last trading day, deliveries can be tendered at the option of the
short members, and the same will be apportioned to the long members on
pro-rata basis. In case of delivery default, the Exchange will resort to buying
in and selling out as a first step before invoking squaring off/closing out
open position.

ROBUST TRADING SYSTEM

The Exchange operates on outcry system for trading. All the post-trading
activities are fully automated (which includes margining). The trades
executed in the ring are confirmed only after the margins are debited and
limits are checked. The Exchange has implemented marked-to-market
concept of daily clearing. The On Line Trading Platform developed in house
and operational within 60 kms. Radius of Indore city was launched by Shri
Sharad Pawar, Hon’ble Union Minister of Agriculture, Consumer Affairs,
Food and Public Distribution on 30th April, 2006 and the nation wide screen
based trading system being developed by CMC Ltd. is likely to be launched
in early 2008 which will bring in more efficiency, integrity and transparency
in the market. GUARANTEED TRADES. All trades confirmed by the
Exchange are guaranteed for performance by the clearinghouse of the
Exchange. The Exchange has created Trade Guarantee Fund to ensure timely
performance of contracts the corpus of which is Rs. 266.52 lakhs as on 31st
March 2007. There is, however, no default of either margin or pay-in by any
member since inception

MANAGEMENT

Professionals who have a deep domain knowledge and understanding of

the commodity futures markets manage the day-to-day affairs of the
Exchange. Competent people who strive to make the system as
contemporary as possible without compromising on the quality lead the IT
team.

The rates quoted on the Exchange serve as a benchmark rates in the

edible oil sector. The settlement rates arrived at by the Exchange are widely
acclaimed by the trade and industry as the genuine settlement rates.