KCBT Wheat Options Achieve New Annual Trading Volume Record

Trading volume in wheat options set a new annual record at the conclusion of yesterday's trade, aided by a surge in local and fund activity. At the conclusion of Thursday's trade, year-to-date volume in KCBT wheat options totaled 113,349 contracts, surpassing the previous annual record of 112,825 contracts established in 1998. More than three months remain in 1999 to build on the new record. Traders attribute the activity to increased market participation by local traders, which has injected more capital and liquidity into the market, making the Kansas City Board of Trade's wheat option market more viable for futures commission merchants. The increased local trading activity makes it easier for funds to enter and exit the market, creating a circular effect and boosting volume, traders said. This marks the third year in a row that the KCBT has set a new annual volume record in wheat options. It also appears that wheat futures volume is on target to set a new annual record this year. To date, 1,784,008 wheat futures contracts have traded. The previous record, set just last year, was 2,006,779 contracts. Options give a buyer the right, but not the obligation, to buy or sell a KCBT wheat futures contract at a specified price. KCBT wheat options have been trading since 1984.