CME Expands Size of Lumber Contract

The Chicago Mercantile Exchange (CME) announced that it has increased the size of the random length lumber futures contract beginning with the January 2000 contract expiration. The contract is currently sized at 80,000 board feet and will increase to 110,000 board feet due to the size and capacity of railcars used to ship lumber. Raising the unit will more closely align the futures contract specifications with common practices in the cash market. The deliverable unit would range from 105,000 board feet to 115,000 board feet. Average daily volume for random length lumber futures increased 25.5 percent for the first quarter 1999 to 1,251 contracts, with open interest currently standing at 4,277. The CME lumber contract represents softwood lumber produced from various species of spruce, pine and fir trees grown in the forests of the western United States and the western provinces of Canada.