Grainnet

NGFA Trade Rules Committee Establishes Task Forces to Explore Industry Issues; One Task Force Created to Discuss Need to Develop Trading Rules for Biofuels

The NGFA's Trade Rules Committee assigned five separate task forces to develop various industry issues during its Dec. 9 meeting in Chicago conducted in conjunction with the NGFA's Country Elevator/Feed Industry Conference.

Among the task forces created by the Trade Rules Committee, chaired by James Keistler, merchandising manager, Twomey Co., Smithshire, IL, is one that is to discuss and explore whether there is a need to develop trading rules for biofuels.

The task force is scheduled to be constituted and conduct its discussions early in 2008.

During its discussions, the Trade Rules Committee recognized that its deliberations were very preliminary and that extensive input from the NGFA membership and all sectors of the biofuels industry was essential to determine whether such rules merit development.

Importantly, even if trading rules for biofuels are eventually developed, buyers and sellers have the right to expressly exclude some or all of the rules from their contracts — as is the case with each of the NGFA's existing sets of Trade Rules.

It also is expected that the topic of possible trading rules for the biofuels sector will be a major session at the upcoming NGFA Trading, Trade Rules and Dispute Resolution Seminar, scheduled for May 6-7 in St. Louis, MO.

Other NGFA Trade Rules task forces consist of:

• A task force derived from the Feed Trade Rules Subcommittee, which will follow up on last year's major effort regarding the prospect of establishing trading rules for distillers grains.

In 2006, at the direction of the NGFA Executive Committee, a broad-based and widely supported task force was formed to identify issues related to trading rules, standardization and quality issues focused on distillers grains.

The 2006 task force concluded that the question of trading rules for distillers grains should be revisited periodically.

Following last week's meetings of the Trade Rules Committee and the Feed Trade Rules Subcommittee, the new task force will consider, in particular, amendments to the Feed Trade Rules to address recurring trade issues related to distillers grains.

This task force expects to have at least preliminary findings to present during the Trade Rules Committee meeting at the March 2008 convention in Scottsdale,AZ.

A task force from the Barge Trading Rules Subcommittee, which will consider rules-related implications that may arise when "busted billing" (instances when a barge is applied and then replaced by another barge) occurs in connection with a string of barge applications.

An ongoing task force consisting primarily of NGFA Trade Rules Committee and NGFA Rail Shipper/Receiver Committee members, that is exploring seals-related trading rules questions.

This task force already has initiated recommendations for changes to the NGFA Grain and Feed Trade Rules, some of which already have been approved by the NGFA Board of Directors and others that are to be recommended to the Board in March 2008.

An ongoing, long-term task force that is to monitor and develop proposed amendments, as needed, to the new Secondary Rail Freight Trading Rules, which were approved by the NGFA Board of Directors in March 2007.

In accordance with NGFA's Bylaws, the new set of trading rules for the secondary rail freight market will be submitted to the NGFA membership for final ratification at the next annual business meeting at the March 2008 convention.

The task force is scheduled to confer periodically, most likely on a semi-annual basis.

For more information, call 202-289-0873.