IntercontinentalExchange (ICE), an operator of regulated global futures exchanges, has said that Board of Directors of ICE Futures US has approved the addition of Brazil as a deliverable origin for the Coffee 'C' futures contract at a differential of 9 cents under par.
The addition of Brazilian Arabica will become effective beginning with the March 2013 contract.
The ICE Futures US Coffee ‘C’ contract currently permits delivery of Arabica coffee beans from 19 countries.
On 3 May 2010, ICE Futures US published an exchange notice requesting the views of market participants on whether Brazil Arabica should be deliverable for the Coffee ‘C’ contract.
At a meeting on 13 October, after full consideration of comments received, the exchange’s Coffee Committee agreed to recommend to the Board of Directors the adoption of the Rule amendments necessary to add Brazil as a deliverable origin.
The Committee has considered the addition of Brazil Arabica to the Coffee ‘C’ contract three times since 1999. The Committee’s previous consideration, in 2005, concluded that it was premature to add Brazil Arabica as a deliverable origin, but recommended reconsidering the issue as commercial experience with Brazil Arabica accumulated.
Following submission of the Rule amendments to the Commodity Futures Trading Commission, Brazil Arabica will be a deliverable growth for Coffee ‘C’ with the March 2013 contract.