IntercontinentalExchange (NYSE: ICE), a leading global exchange operator and over-the-counter (OTC) energy marketplace, today announced that the Board of Directors of its ICE Futures U.S.TM subsidiary has voted to end open-outcry trading for futures contracts at the end of February 2008, as trading in the exchange’s futures contracts is now primarily electronic. Trading in ICE Futures U.S. futures products will be available exclusively on the ICE platform beginning the evening of Sunday, March 2nd, 2008 for the trade date March 3rd, 2008. The futures contracts that will transition to fully electronic markets include coffee, cocoa, cotton, orange juice, sugar, equity indexes and currencies.
Open-outcry trading for all options on futures contracts will continue. Options on futures contracts at ICE Futures U.S. have not yet begun trading electronically, and a timeline for the introduction of electronic options will be provided in the first quarter of 2008.
The trading floor will remain open to support open-outcry trading of options on futures contracts. It will also be available for use by member floor brokers who wish to conduct their futures operations or proprietary trading from the facility.
Trading at the exchange’s trading facility in Dublin, Ireland, which provides open outcry trading of currency futures contracts during the European trading day, will also end at the close of the session on Friday, February 29th, 2008.
These decisions are in accordance with the terms of the merger between ICE and the New York Board of Trade, now named ICE Futures U.S., which was approved in December 2006 and closed in January 2007. Under the Merger Agreement, open-outcry trading for any of the soft commodities may be ended if average daily open-outcry volume over a rolling three-month period is below 50% of the average daily volume for the comparable period in 2005. Since July, approximately 80% of soft commodity futures contracts have been traded electronically.
"After consultation with the commercial and trading communities following the overwhelming success of electronic trading, the Board has unanimously voted to transition to fully electronic futures markets. The exchange’s progressive transition to electronic trading this year has brought many benefits to the market, including growth in volume and participation. We believe it is in the best interest of our customers and the competitiveness of the exchange on a global scale to centralize liquidity in an electronic marketplace," said Tom Farley, president and coo of ICE Futures U.S.
Farley added: "With the continued growth opportunities in the commodities asset class through increased investment and participation, we are pleased that an increasing number of our open-outcry traders are taking advantage of the training and trading opportunities we offer at our New York Trading Center. We welcome the opportunity to provide further training and market access tools to the community as we complete the transition to electronic futures markets."
ICE established the ICE Trading Center, located at 2 World Financial Center in lower Manhattan, earlier this year to provide authorized market participants with training and the latest in technology and market access to support the requirements of professional traders. ICE plans to offer new training courses at the Trading Center for the floor community in early 2008 with an emphasis on the transition from open-outcry to electronic trading. A detailed schedule of course dates and offerings will be published in the near future.
ICE Futures will provide further technical, member and customer updates throughout the process. A Frequently Asked Questions (FAQ) document providing further information about this announcement has been posted to the ICE website at https://www.theice.com/exchange_notices.jhtml.