FERTILIZER CONTRACTS FROM CME HELP FARMERS MANAGE RISK

Jul, 11, 2011  |  Today's News

Today, the Chicago Mercantile Exchange adds a new product to their portfolio.  Contracts for urea, urea ammonium nitrate (UAN), and di-ammonium phosphate (DAP) began trading today on the New York trading floor and are cleared through CME ClearPort.

These new fertilizer contracts provide opportunities for fertilizer companies and farmers to manage their risk.  Ideally, the option to manage risk will make contracts between fertilizer retailers and farmers less risky and impacts to farmer margins will be minimized.

“For more than 150 years, agricultural producers and agribusinesses have relied on our benchmark grain futures and options contracts to manage their commodity price risk,” said Tim Andriesen, Managing Director, Agricultural Commodities and Alternative Investments, CME Group.  “The fertilizer products we’re introducing allow market participants to manage fertilizer prices, one of the key and most volatile price inputs into grain production, further allowing a focus on margin management.”

To learn more about the four new CME Group fertilizer swap futures, how they work, and how you can get involved, check out the information on the following links.

ClearPort Demonstration

ClearPort Brochure  

ClearPort Brokers

ClearPort Settlements

Illinois Corn is excited about the opportunity for farmers to have more options to manage the increasingly volatile markets that impact their business.  If you have questions on how you might utilize this new tool to your benefit, please contact Phil Thornton at 309-557-3257 or pthornton@ilcorn.org.