CME Group, the world’s leading and most diverse derivatives marketplace, has announced the launch of Cheese futures and options on futures. The cash-settled contracts will be available on CME Globex, the exchange’s electronic trading platform, with trading scheduled to begin on June 20, for trade date June 21. These contracts will be listed by and subject to the rules and regulations of CME.
“This contract was requested by our customers such as manufacturers and processors of cheese to better fit the needs of their risk profile,” said Tim Andriesen, CME Group Managing Director of Agricultural Commodities. “Many of these customers already participate in our Class III Milk and Dry Whey futures and options markets. The new Cheese contracts will enable them to directly lock in future prices for cheese.”
Cheese is made from Class III milk. Dry whey is a byproduct of processing the milk into cheese. Manufacturers, processors, food companies and others have used the Class III contract to meet their hedging needs since 1996 and the Dry Whey futures contract launched in 2007. The Cheese futures will complete the “dairy crush” with which the original commodity as well as its product and byproducts can be hedged.
The new contracts will be listed monthly with each contract representing the equivalent of 20,000 pounds of cheese and the tick size of $0.001 per pound. Trading hours are Sunday through Friday, 5:00 p.m. to 4:15 p.m. Chicago time with daily trading halts from 4:15 p.m. to 5:00 p.m.
Source: CME Group