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Pursuant to Contract Terms 15.1 and 15.3 of the Futures Contracts and to Contract 8.1 and 8.3 of the Options Contract, NZX Limited (“NZX”) hereby notifies Participants that each of the WMP Futures, AMF Futures, SMP Futures and WMP Options Individual Contract Specifications and the WMP Futures, AMF Futures and SMP Futures Contract Terms and Administrative Procedures will be amended to reflect the following two changes:
1. Trading Hours
NZX has amended the Individual Contract Specifications, as outlined below, in order to have the discretion to change the Trading Hours of the Derivatives Market if and as required, primarily to accommodate shortened Trading Hours over the upcoming Christmas and New Year holiday period. This will also ensure that the procedure for determining trading hours in respect of the Derivatives Market is consistent with the procedure for determining trading hours in respect of the Cash Markets.
NZX will notify the Market of any change to the standard Trading Hours specified in the Contract Specifications by email and website notice.
Specifically, NZX will amend the Individual Contract Specifications for the following Futures and Options Contracts:
NZX Derivatives Market Contract No. 1 Global Whole Milk Powder (WMP) Futures (“WMP Futures”);
NZX Derivatives Market Contract No. 2 Global Anhydrous Milk Fat (AMF) Futures (“AMF Futures”);
NZX Derivatives Market Contract No. 3 Global Skim Milk Powder (SMP) Futures (“SMP Futures”); and
NZX Derivatives Market Contract No. 4 Global WMP Options.
The “Trading Day” or “Trading Hours” section (as applicable) of each Contract Specification will be amended by the inclusion of “or as determined from time to time by NZX by notice to the Market in accordance with the NZX Derivatives Market Rules and Procedures”.
NZX will also amend the term “Trading Day” in the WMP Options Contract Specification to “Trading Hours” to ensure consistency of terms across all Futures and Options Contract Specifications.
These amendments will take effect from Tuesday 18th December 2012.
2. Final Settlement Price Calculation Method
As previously announced to the market on 17 October 2012, NZX will change the final settlement price methodology for certain Futures Contracts. To that end, NZX will amend the Individual Contract Specifications and the Contract Terms and Administrative Procedures for the below Futures Contracts for Contract Months from July 2013 onwards:
NZX Derivatives Market Contract No. 1 Global Whole Milk Powder (WMP) Futures;
NZX Derivatives Market Contract No. 2 Global Anhydrous Milk Fat (AMF) Futures; and
NZX Derivatives Market Contract No. 3 Global Skim Milk Powder (SMP) Futures.
The above Individual Contract Specifications currently state that Last Trading Day shall be “the last Business Day preceding the first GDT auction of the month i.e. trading in the March WMP/AMF/SMP (as applicable) Futures Contract will expire on the last Business Day immediately preceding the first GDT auction in April.”
NZX will amend the Last Trading Day section of each Contract Specification by replacing the word “first” with “last” and the word “April” with “March” so that the definition of Last Trading Day shall then be “the last Business Day preceding the last GDT auction of the month i.e. trading in the March WMP/AMF/SMP (as applicable) Futures Contract will expire on the last Business Day immediately preceding the last GDT auction in March.”
In respect of the Contract Terms and Administrative Procedures for each of the above Futures Contracts, the example provided in the definition of “GDT Period” under clause 1.1 will be removed.
The amended Contract Specifications and Terms and Administrative Procedures will be available at http://www.nzxfutures.com/dairy/contract_specifications from Tuesday 18th December 2012.
NZX has made the above amendments in accordance with the NZX Derivatives Market Rules.
For further information please email dairyfutures@nzx.com.
