In response to pressure over the last year, the CBOT has responded to requests from its regulator, the Commodity Futures Trading Commission, and will now limit the number of warehouse receipts and grain shipping certificates a non-grain company can hold.
This is especially targeted to soft red winter wheat contracts, to improve its hedging effectiveness, which has been dismal for some time. At the same time it'll help other grain contracts like corn, rice, wheat, oat, soybean, soymeal and soyoil.
Starting on February 17, the Chicago Board of Trade will enact the limits on the non-grain holding companies that hold grain shipping certificates or warehouse receipts, which will be given until May 31 to comply with the new rules.
Here are the parameters below:
Commodity - Limit
Corn shipping certificates - 600*
Soybean shipping certificates - 600*
Wheat shipping certificates - 600*
Soybean oil warehouse receipts - 540
Soybean meal shipping certificates - 720
Oat shipping certificates - 600
Rough rice warehouse receipts - 600
*Includes certificates for CBOT mini-contracts.
Monday, January 5, 2009
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