NZX Launch Date For Global Whole Milk Powder Futures
NZX has announced that it is launching its Global Whole Milk Powder Futures (“WMP”) contract on 8 October 2010.
NZX Global Whole Milk Powder Futures will be a vital tool for the dairy industry worldwide to manage price risk in the most heavily traded milk powder product in the world.
“Demand for NZX Global WMP Futures has been very strong, particularly from offshore, and we have timed this launch to ensure all participants are ready to support trading from day one,” said NZX CEO Mark Weldon.
“New Zealand has proven we are good at dairy. It’s what we do. The world recognises this, and now we are bringing the world a tool that is made in New Zealand, globally relevant and built in response to global demand, matching the growing demand for the physical WMP commodity itself,” said Weldon.
The NZX contract will be cash settled, providing the market with a simple and efficient risk management tool that does not rely on complicated physical delivery methods.
“The feedback we received from the global dairy industry confirmed that a physically delivered futures contract on globally traded dairy commodities is far from ideal. The overwhelming preference is for cash settlement,” said NZX Head of Markets Fiona Mackenzie.
“We owe a huge thanks to the dairy industry in New Zealand and worldwide for their input and support in the development of this product. It is through this support that we have been able to develop a truly global set of dairy risk management tools,” said Mackenzie.
NZX would also like to acknowledge the part played by the New Zealand government and officials in enabling this market to be established.
NZX Dairy Futures will be traded on the NZX electronic platform, GlobalVision, and centrally cleared through the new clearing house, operated by New Zealand Clearing Limited.