LONDON, Aug 29 (Reuters) - The first physical coal futures contract should start trading on an international exchange in the first or second quarter of next year, the head of electronic coal trading platform globalCOAL said on Wednesday.
Previously, the platform, which is creating the product, had said it should start trading by the end of 2007.
“The launch will be Q1 or Q2 next year,” globalCOAL Chief Executive Officer Eoghan Cunningham told Reuters. “There are a few more hoops to jump through and we need time to work with the clearing house, clearing banks and the market to determine delivery specifics.”
He said the physically-settled futures contract would be based on CIF/DES ARA, or delivered basis coal, and on globalCOAL’s Standard Coal Trading Agreement (SCOTA).
Dealers have said the ICE electronic platform (ICE.N) or the New York Mercantile Exchange NMX.N are the most obvious places to trade a futures contract for coal, one of the last commodities not to have a physically-settled futures contract on an international exchange.
Already ICE carries the API2 and API4 coal swaps, which are cash settled.
London-based globalCOAL operates the coal market’s only screen-based physical trading platform.