NZX
27/11/2014 16:13
GENERAL
NOT PRICE SENSITIVE
REL: 1613 HRS NZX Limited
GENERAL: NZX: NZX launches Global Butter Futures Contract
NZX is pleased to announce it will launch a Global Butter Futures Contract on
Friday 12 December. This follows successful testing of the service and
receipt of regulatory approval from the Financial Markets Authority.
Butter futures are a global risk management tool for participants operating
in the dairy commodities industry. The contracts will trade off the
underlying price for unsalted butter on the GlobalDairyTrade auction
platform.
BNP Paribas and FC Stone will clear the contracts, continuing to provide a
vital service by settling and clearing trades on behalf of all NZX trading
participants.
NZX Head of Markets Aaron Jenkins commented: "With annual global trade in
butter valued at more than US$2.5 billion, NZX is committed to developing
tools to allow customers of New Zealand butter to manage the impacts of
global price volatility."
"Trading volumes on NZX's Dairy Derivatives market are on track to increase
by more than 125% in 2014, so it's the right time now to expand our range of
contracts we have on offer."
The path to launch the NZX butter futures contract included extensive
consultation and planning, with a range of external stakeholders in New
Zealand and internationally.
NZX's butter futures are cash settled. Cash settlement of a futures contract
means trading is much simpler and easier without the need for participants to
implement complicated delivery mechanisms nor risk being exposed to having to
make, or take, delivery of product.
Cash settlement is even more desirable for dairy commodities versus other
soft commodities where food safety criteria and the actual delivery process
are complex and not globally standardised.
For further information please contact:
Kate McLaughlin
Corporate Communications
M: 027 533 4529
E: [email protected]
End CA:00258205 For:NZX Type:GENERAL Time:2014-11-27 16:13:31
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