10/27/2003
The contract unit shall be 1,550 tons of coal per contract. A loading tolerance of sixty (60) tons or two (2%) whichever is greater, over the total number of contracts delivered per scheduled delivery pursuant to 250.13(E)(2) is permitted.Recently, coal delivery participants have raised questions as to the tolerance and its application as prescribed by the Rule. Consequently, the Exchange would like to give clarity on this topic.
The term scheduled delivery as it is used in Rule 260.05, means the number of contracts delivered within a day, at a specific delivery facility irrespective of the number of contracts matched in the tender. The Clearing Member making delivery (Seller) must submit to the Clearing Member accepting delivery (Buyer), with a copy to the Exchange, the Exchange prescribed form entitled "Notice of Seller's Confirmation Delivery Schedule". In addition to the relevant contract information associated with the tender number, the form must contain the following: number of contracts, delivery date and delivery terminal. For example, assume a tender quantity for two matched participants is ten (10) lots at a specific terminal. Further, the Buyer and Seller schedule a delivery of four (4) contracts to be loaded by barge on a specific day. The loading tolerance will apply to the four contracts lifted within that day. The loading tolerance for each subsequent scheduled delivery, until the entire tender quantity is delivered, will be applied accordingly.