CME Group Acquires Kansas City Board of Trade

From CME Group:

To Our Valued Customers:

A few weeks ago we told you about CME Group’s plans to acquire the Kansas City Board of Trade (KCBT). We are pleased to announce that the acquisition has been completed, and we will be able to offer you greater capital efficiencies, new trading opportunities and additional products over the coming months.

Today, you can already trade both KCBT’s flagship Hard Red Winter (HRW) wheat futures, the international benchmark for bread wheat prices, and the CBOT Soft Red Winter (SRW) wheat contract, the most liquid wheat futures contract and the benchmark for soft wheat, on CME Group’s Globex electronic trading platform and through open outcry. Combined with CBOT’s nascent Black Sea Wheat contract, this makes CME Group a comprehensive marketplace for the global wheat trader.

As an initial benefit, beginning Monday, December 10, 2012 you will be able to take advantage of implied functionality on CME Globex to trade the KCBT-CBOT Wheat futures spread. This will allow you to capitalize on the price differentials inherent in the two classes of wheat by executing this popular spread as a single trade, rather than by legging into each individual contract. This is just the beginning of the new products and enhancements we plan to provide.

We appreciate your business and look forward to continuing to work with you to provide solutions to your risk management and trading needs.

For more information about this announcement please view our press release.

Sincerely,

Tim Andriesen
Managing Director, Agricultural Products
CME Group

Announcing CBOT Black Sea Wheat Futures

Introducing CBOT Black Sea Wheat futures, the first physically delivered Wheat futures contract with delivery points in Russian, Ukrainian and Romanian ports along the Black Sea.  This contract will be listed for electronic trading on the CME Globex platform starting June 6, 2012 and cleared through CME Clearing.

This contract will provide participants with the first truly effective tool for price discovery and risk management in the rapidly growing Black Sea Wheat market – a need that has been underserved by existing futures contracts, which have not offered strong correlations to regional wheat price returns.

Features:

  • Physically delivered wheat through Russian, Ukrainian and Romanian ports
  • U.S. dollar-denominated
  • Electronically traded on CME Globex
  • Access to a market that accounts for over 20 percent of global wheat exports
  • Regionally relevant trading hours: 10:00 a.m. to 9:15 p.m. GMT+ 2 (GMT +3 daylight savings) / 2:00 a.m. to 1:15 p.m. Chicago Time (CT)
  • Dedicated market makers offering two-sided markets
  • Centrally cleared by CME Clearing
  • More than 100 years of experience building liquid and global agricultural commodity benchmarks

The addition of CBOT Black Sea Wheat futures further enhances benchmark opportunities available through CME Group’s leading wheat trading platform, which is headlined by CBOT Wheat futures, the world’s most liquid global wheat benchmark.

Learn more:

MGEX and CME Group Announce the Launch of MGEX-CBOT Wheat Spread Options

MINNEAPOLIS and CHICAGO – MGEX, a Designated Contract Market and Derivatives Clearing Organization, and CME Group, the world’s leading and most diverse derivatives marketplace, today announced the launch of MGEX-CBOT Wheat Spread Options to begin trading March 26.

MGEX-CBOT Wheat Spread Options are unique hedging tools based on the price differentials between hard red spring wheat futures listed on the Minneapolis Grain Exchange, Inc. (MGEX) and soft red winter wheat futures on the Chicago Board of Trade (CBOT).

Summary and Highlights of USDA’s 10/17/11 Data Users Meeting

Special thanks to Rich Feltes, VP Research at RJ O’Brien, for sharing his summary and highlights of USDA’s Data Users Meeting on October 17, 2011.

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CMC Attended CBOT Public Meeting On Corn Price Limits

This week, CMC participated via webcast in the CBOT meeting on daily corn price limits.  From reports, the event was fairly contentious but CME insisted it was still open to feedback from its customers.  The proposal, currently being considered, would raise daily limits to 40 cents a bushel from 30 cents.  To learn more . . .

CME Fact Sheet

CME’s Tim Andriesen’s Comments

CFTC Comment File