This is a significant development for the Australian Futures markets because it uses a delivery process that offers a level of transparency not available in Australia until now. The unique transparency means for example, that the risk of a price squeeze is minimised.
Stock level information will be released to the market. All customers can view grain quantities ready to be delivered against open futures positions on the ASX website each week. Live and transparent price and information is available on ASX's state of the art electronic trading system and all data vendors.
ASX Managing Director and Chief Executive Officer, Richard Humphry, said the move, foreshadowed by ASX in February, has received a large level of industry interest and support.
"This latest initiative is consistent with our strategy of broadening our product range and offering innovative futures contracts. The Australian agricultural industry participants are very large users of contracts traded overseas and have indicated a preference to also trade locally."
The first contract offered will be Milling Wheat Futures. Milling Wheat is the premium grade of wheat grown in Australia, and the mostly widely traded on the Australian track market. To follow will be Feed Wheat (22 May) and Barley (26 May), with Canola and Sorghum to be advised pending final agreement.
