Published On: Wed, Apr 11th, 2012

NZX Dairy Futures Break Through 20000 Lots Traded

NZX CEO Mark Weldon

NZX CEO Mark Weldon

NZX Dairy Futures passed the critical milestone of 20,000 lots traded in the 18 months since launch in late 2010.

Even more significant is the growth momentum in these products: it took just on a year for the first 10,000 lots to be traded, whereas the second 10,000 lots took just four months.

“This is a real milestone for the product and demonstrates clearly that liquidity is building and participation is growing. Support from the industry in using these contracts has been tremendous and that continuing and growing participation means NZX Dairy Futures are the most liquid tool available for managing price risk in globally traded dairy commodities,” said Kathryn Jaggard, Head of Derivatives at NZX.

December, January and February are traditionally months with lower levels of activity due to global holidays, but March 2012 saw activity kick back in with a record volume month. March also recorded the largest volume day and the largest volume week in the history of NZX Dairy Futures.

Average daily volume is now at an all time high of over 200 lots per day.

“NZX Dairy Futures are now in place where many super liquid futures contracts started, with a good base of liquidity and growing global support. What is pleasing is that we are also seeing increased activity in this market from customers in Asia who are hedging dairy purchases and we expect that activity to increase,” said Jaggard.

“This is a great result for those looking for viable tools to mitigate risk. Certainly the dairy industry has been seeking the development of such tools in recent years and it is their endorsement of contracts such as NZX Dairy Futures that makes a market work,” said NZX CEO Mark Weldon.

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