After five years of discussions, the commodity futures industry yesterday formally proposed creation of a self-regulatory organization to oversee the business in the same way the National Association of Securities Dealers policies the sale of stocks.

The new group, called the National Futures Association, asked the Commodity Futures Trading Commission to designate it as a government-sanctioned oversight organization.

If the CFTC approves the application as expected, the National Futures Association will take over some of the paperwork now handled by the CFTC and will for the first time regulate some parts of the commodity trade that have been uncontrolled.

The self-regulatory body would have authority to issue rules covering all aspects of commodity trading and to enforce those rules with penalties ranging up to expulsion from the business.

Congress authorized formation of the self-policing body in the same legislation that in 1974 created the CFTC to assume regulatory responsibility previously held by the department of agriculture.

Two years ago Congress passed special legislation that in effect made membership in the organization mandatory for every individual and firm in the commodity business. That legislation exempted the Futures Association from federal antitrust laws which otherwise would have made compulsary participation illegal.

A committee of commodity executives incorporated NFA in 1976 and since then has been negotiating the structure and powers of the organization.