Euronext to add dairy futures support mechanism
“The full suite of futures and options will cover the three key dairy products currently traded in Europe and internationally: butter; skimmed milk powder and whey powder”, said Euronext, the exchange which spans Belgium, France, the Netherlands, Portugal and the UK.
The European Union, the world’s top dairy producer, is scheduled to abolish milk quotas from April 2015. Euronext had already launched an EU skimmed milk powder contract in 2010 but suspended it in July due to a lack of liquidity.
The exchange is targeting commodities as a growth area after its spinoff from Intercontinental Exchange this year.
It plans to develop some products with China’s Dalian Commodity Exchange and it has also overhauled its flagship wheatfutures in response to controversy over quality and delivery terms.
Euronext exchange launched rapeseed oil and meal markets earlier this month to tap into growing demand from food, livestock and energy sectors.
In the United States, CME Group operates a dairy futures contract based on US supplies. Meanwhile, Euronext has also stated that the recent sharp rise in European shares was fuelled by expectations of further stimulus measures from the European Central Bank.
At one stage in trading last Thursday, Remy Cointreau surged 6% after the French spirits group — whose cognac sales have been hurt by a Chinese government crackdown on ostentatious spending — reported a smaller-than-expected drop in profit.
The benchmark FTSEurofirst 300 index of top European shares has risen 14% since a low hit in mid-October, lifted by the prospect of further measures from the ECB including quantitative easing.
