RE: Spring Wheat Delivery Rulebook Interpretation
TO: Clearing Members, Membership & Spring
Wheat Regular Elevators
DATE: October 11, 2001
FROM: Mark G. Bagan, Vice President, Market Regulation
During the year, it came to the attention of the Minneapolis Grain
Exchange (MGEX) there were concerns regarding the making and taking
of physical rail delivery of Spring Wheat in satisfaction of warehouse
receipts. In particular, the MGEX learned there was confusion
and disagreement between parties about the load-out obligations,
grading and appeal process, and allocation of demurrage. Consequently,
the MGEX Contracts Committee took the matter under review.
After deliberate, extensive and thorough consideration of the known
issues, the Contracts Committee recommended and the Board of Directors
adopted the attached Interpretation. The Interpretation does
not alter the current Rules or Regulations; rather, the Interpretation
elaborates on their intent. Generally, the Interpretation
addresses certain obligations and responsibilities of the parties
involved in the Spring Wheat delivery process. Specifically,
the Interpretation helps define default on delivery and allocates
the cost for demurrage dependant upon grading results. The
Interpretation is effective immediately.
In order for the Spring Wheat futures contract to remain a widely
accepted and used pricing mechanism, the delivery pro cess must
work efficiently and without unnecessary conflict or confusion.
Therefore, all parties in the delivery process are encouraged to
quickly become familiar with the Interpretation and cooperate in
If you have further questions, I may be reached at (612) 321-7166.
Click here to read the interpretation.