ICE anyone?

[blackpowder]

OK Whats the sentiment out there on the new ICE contracts?
Odds on survival?
No one's using them yet.
We desperately need the barley to work. Do we need a durum? HRS?
I really hope they succeed, but I'm not confident at this point.

[Wheatking]

How do you get liquidity, when no one wants to trade
in a market until it has some.

What are some ways to get liquidity, perhaps eliminate
the commission fees for the first year.

Perhaps if they made it easier to make delivery on a
contract it might get farmers trading. I am not
really sure what the answer is but there needs to be
something done to get a transparent market for barley.

[farmaholic]

Would there ever be enough volume in barley and durum to make it work.

[pgluca]

I would really like to see these contracts work, but I think they tried to start them a little too early. I think that timing would have been better mid summer. I realize that they might miss some future hedging, but I think they would have more volume when people see what is in the field and the CWB is totally done their contracts. I too would really like to see barley work,I used to use Canola too.

[btjadenlepp]

I really like the contracts, and I really want them to work, because I think it will be much easier to discern basis signals against a local contract than against Mpls or Chicago.

If you agree, tell your local grain buyers to feed the message up the chain that you'd like to sell some new-crop spring/durum/barley on a basis contract against the ICE contract.

[jdepape]

The thing is, these contracts are reflecting the
market activity in new crop. Once we see
increased cash market activity in new crop
positions, we should see more volume in the
futures. Remember when we thought we had an
open barley market in 2007? Close to a million
tonnes of feed barley was sold to the Saudis and
the barley futures contracts rocked - went from
near nothing in volumes to sizeable trade.

What we need is a market event. That might be
harvest pressure.

[jdepape]

As for increased farmer participation if delivery
was possible - I can't think of a faster way to kill a
contract.

We had "farmer delivery" on a previous version of
western barley futures. It was basically used as a
cash contract. Farmers would sell the futures with
the intent on delivering. Problem was, the guy
that bought the futures as a hedge couldn't get out
by selling the futures - because the farmers who
sold the futures didn't want to buy them in - they
wanted to deliver.

True hedgers quickly realized that the contract
could not be used as an effective hedge, sucking
the liquidity out of the market.

There are better ways to discipline a futures
market. We need to get everyone thinking about
futures as hedges and cash contacts as
deliverables.

Something to watch for -- once wheat is open,
everything you grow will be a cash crop. Watch
for tight basis levels on everything that has a
basis. If we do this right, you won't want to deliver.

(Cash canola at $10 over. Do you still want to
deliver against futures?)