When a warehouse sends the notice to the owner that the bags in a lot are in need of rebagging, the warehouse will also be required to indicate that condition in COPS ("rebagging indicator"). The owner will have five business days to file with the warehouse an objection to the notice to rebag. A copy of the objection must also be filed with the Exchange along with a non-refundable fee of $375.
If the warehouse and the Exchange do not receive the objection in the five business days, the owner will be deemed to have authorized the rebagging and be responsible for all costs associated with the rebagging. If the owner has filed a timely objection and paid the fee, the Exchange will cause the bags to be surveyed by a randomly chosen Exchange-licensed warehouse inspector. The inspector will visually survey the bags and make a final determination as to the bags' condition. If the inspector determines that the coffee does not need to be rebagged, the warehouse must remove the rebagging indicator from COPS as soon as possible. If the inspector determines that the coffee needs to be rebagged, the warehouse will maintain the rebagging indicator in COPS until the coffee is rebagged, and the owner shall pay the Exchange the inspector's fee. This procedure is similar to the procedure used during the delivery period by receivers to determine the condition of the bags being delivered to them.
If the owner does not want the warehouse to rebag the coffee but would rather have the rebagging indicator remain on the lots, the owner must send written notification within five business days to the warehouse and the Exchange that the owner does not authorize rebagging but wishes that the rebagging indicator remain on the coffee.
The lot will not be eligible for delivery as long as the lot has the rebagging indicator in COPS. However, the coffee itself will not lose its certification, which goes to the quality and grade of the coffee and not to the condition of the bags in which it is being delivered.
The number of certified bags with a rebagging indicator will be shown in the Exchange's certified stock report. The Exchange will also keep track of the number of deliveries and months a lot has had the rebagging indicator on it.
The New York Board of Trade (NYBOT) is the parent company of the Coffee, Sugar and Cocoa Exchange, Inc. (CSCE) and the New York Cotton Exchange (NYCE). Through its two exchanges and their subsidiaries and divisions NYBOT offers an expanding range of agricultural, currency and index products.
