Just over a week into the deregulated Prairie wheat and barley marketing regime, a relic of the single-desk barley market has been shut down.
Winnipeg commodity exchange ICE Futures Canada said Thursday it has delisted its Western Barley (AB) futures and options contracts as of 2 p.m. CT.
The Winnipeg exchange’s board of directors passed a resolution Tuesday, approving the delisting of the contract and repeal of all rules pertaining to it.
The AB contract had seen no trade activity since April 23 and there was no open interest in the contract at the time of its delisting, ICE said Thursday.
The decision does not affect ICE Futures Canada’s new Barley (BW) contract, which along with a new milling wheat contract was listed on Jan. 23, after the federal government pased Bill C-18 ending the Canadian Wheat Board’s single marketing desk.
The BW contract does not specify for malting- or feed-grade barley.
"Some participants may choose to use the Western Barley contract, but if interest remains low, at a point in time we’d delist it," ICE Canada CEO Brad Vannan said as the new contract was being developed last year.
The now-delisted AB contract was intended as a risk management tool for the feed grain and livestock sectors. The contract had undergone tinkering for years in attempts to make it a more useful pricing tool for the commodity.
The last major revisions to the AB contract came in June 2009, when its delivery region was moved from central Saskatchewan to a buyer’s facility in the "feedlot alley" area around Calgary, Brooks and Lethbridge. The move was expected to tie the contract’s price signal more closely to the cash market.
Some traders, however, noted that distillers grain making its way from the U.S. ethanol sector into the Prairie feed industry in recent years has hindered the AB contract’s usefulness.
ICE Canada’s western barley futures near extinction, Dec. 11, 2010