The positional limits of the near-month sugar contracts have been revised by the foremost agri-commodity bourse NCDEX - National Commodity and Derivative Exchange - in an attempt to check the mounting speculation in sugar future trading.

Announcing the move in its official statement, NCDEX said: "The trading and clearing members are hereby informed that, as per the directives received from the Forward Markets Commission (FMC) and in terms of the Bye-laws, Rules and Regulations of the Exchange, the near month limits on open position in contracts of Sugar have been revised to 6,000 tons from 7,500 tons."

The NCDEX release also mentions that the reduced position limits will come into effect May 21, 2009 onwards.

According to an analyst with commodity brokerage firm Karvy Comtrade, the NCDEX move is aimed at diminishing the speculative factor, with traders being restricted to trade beyond 6,000 tons a month prior to the termination of the contract.

In April, the NCDEX measure to check prices included a five percent imposition of special margin on long positions of all running contracts of sugar, with the exception of contracts expiring in August this year.

Such measures are resorted to by the exchanges as a Committee of Secretaries' directive requires FMC to observe price-trends in the futures market and take steps accordingly.