There are actually several types of transactions that are covered by section 988.
For items that an individual has under section 988 these are often reported on Form 6781 because it is from a straddle or similar contract. See http://www.irs.gov/pub/irs-pdf/f6781.pdf
Unfortunately, most of the K-1, letters with the K-1 and notes do not give enough information to be certain exactly what is being listed on line 11.
When lacking guidance from the partnership as to whether or not this does belong on Form 6781 my usual form of reporting is to take all of these amounts as Other Income (line 21, Form 1040).
Even though the partnership is a passive activity, my understanding of these types of transactions are that the income is neither passive nor portfolio income (so Other Income is proper, and not subject to passive loss rules) for a partnership that is basically an investment vehicle for the partners.
"Sec. 988. Treatment of certain foreign currency transactions
(a) General rule
Notwithstanding any other provision of this chapter -
(1) Treatment as ordinary income or loss
(A) In general
Except as otherwise provided in this section, any foreign
currency gain or loss attributable to a section 988 transaction
shall be computed separately and treated as ordinary income or
loss (as the case may be). "
See also Reg. 1.469-1T(e)(6)(i), which says that "an activity of trading personal property for the account of the owners of interests in the activity is not a passive activity, regardless of whether the activity is a trade or business."
Hope this helps for deciding how to properly report these items or if you need more information from the partnership to make that decision.
Please ask if you need more discussion or clarification.