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ICE Futures Canada tightens daily price limits

Winnipeg commodity exchange ICE Futures Canada has tightened up the regular daily price limits for its canola and western barley futures, but with some room for expansion.

Effective at 8 p.m. ET on Monday (Nov. 29), the daily limit for canola futures traded on the ICE Futures Canada platform is cut to $30 per tonne, down from $45 previously. The daily limit on western barley futures is now $10 per tonne, down from $15.

Those limits, however, can expand in the following trading session if the daily settlement price reaches limit up or limit down in any two contract months at the same time. The limits would then expand to $45 and $15 per tonne for canola and barley respectively.

And if the settlement price reaches limit up or limit down for any two contract months while at those expanded limits, the daily price limits would then expand again for the following trading session, to $60 per tonne for canola and $20 per tonne for barley.

If, while the price limit is in either of those expanded ranges, no contract month settles limit up or limit down, the daily limit would then contract back to its next-lowest level in the following trading session.

In keeping with the new daily price limits, ICE Futures Canada has also lowered its reasonability limits and its no-cancellation ranges, both to $8 for canola and $5 for barley, down from $12 for canola and $8 for barley.

Cabinet trades

ICE Futures Canada also announced Friday that effective Monday, it would allow cabinet trades to be conducted in options.

For options contracts valued at less than 10 cents per tonne, cabinet trades would be allowed to be entered into ICE’s clearing system at values between one and nine cents per tonne, but for no other purpose than to liquidate existing options positions for both parties to a trade.

Such trades are negotiated off-exchange between counterparties, with each side entered directly into the clearing system by their respective clearing participant, to liquidate deep out-of-the-money options at values less than one tick.

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