REGINA – The Chicago Board of Trade will launch a “whole family” of corn yield contracts Jan. 19 following its successful pilot program last year.
Ann Berg, an independent trader who chairs the CBOT’s crop yield insurance advisory committee, said the pilot contract achieved the highest open interest during the shortest period of time in the last 40 years that agriculture products have been launched.
Originally conceived in 1993, the Iowa corn yield insurance futures contract opened last June and closed Sept. 12 with 2,600 futures and options open, Berg told the Western Canadian Wheat Growers Association annual convention here Jan. 4.
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“The crop yield contract is really an educated bet on yield per acre for a particular region,” Berg said.
“Over 35 firms participated in the contract, which I think is the most encouraging thing since typically it’s difficult to get five or six players in any new contract,” she said.
Berg said the contracts offered in 1996 will include a national yield.
Both Berg and Winnipeg Commodity Exchange president Fred Siemens were asked when a futures contract for durum would be available.
“It depends on you,” said Siemens. “We’ll list a contract on anything that’s available. Contracts can’t be listed if there’s only one buyer.”
“The problem is trying to find the right delivery terminals and so on,” Berg added.
She said the Chicago Board of Trade wants to get the corn yield contracts established before looking into wheat.
Both wheat and bean contracts have been developed, she said, and will be listed eventually.
