July 12, 2011

New Zealand's dairy futures pass 1,000 milestone

NZX Dairy Futures have now exceeded 1,000 lots traded since the launch of the market in October last year.

Trading activity was particularly strong last week following the GlobalDairyTrade auction on July 5, with most of the recent activity centred on the Global Whole Milk Powder August 2011 Dairy Futures contract.

The NZX Dairy Futures market has also seen a significant rise in the volume being posted, with multiple bids and offers being entered into the market.

By comparison, NZX Dairy Futures' three global competitors have chalked up just 32 trades between them since launching their own global dairy futures products last year.

"New Zealand can be immensely proud of its dairy futures market because it proves the dairy dominance of our tiny country, not only in pastoral farming practices and innovation at the farm gate and beyond, but also in serving the needs of global traders and processors who rely on price certainty in this vital commodity," said NZX Derivatives Manager Kathryn Jaggard.

"Futures markets, by their very nature, tend to grow incrementally, trade by trade, as people build up knowledge and trust in the product that it will serve their business needs. Locking in a price for dairy commodities is a serious business planning tool right across the sector," she added.