"With this product, CME is now bringing butter contracts into the 21st century with electronic trading as well as by adapting the contract specifications to meet the needs of contemporary users," said John Harangody, Director, CME Commodity Products. "This is a prime example of CME's product innovation, even in well-established markets, and of our ability to meet the ever-changing needs of our customers with relevant risk management tools."
CME Cash-Settled Butter futures are designed to meet the needs of the food industry, which have exposure to butterfat risk, but do not want to risk physical delivery. The contract will also differ in that the trade unit will be 20,000 pounds of Grade AA butter versus 40,000 pounds for the existing CME Butter futures contract. The contract will be cash settled based upon the USDA monthly weighted average price in the U.S. for butter.
For more information on this product, please visit http://www.cme.com/butter .
Chicago Mercantile Exchange Inc. ( http://www.cme.com ) is the largest futures exchange in the United States. As an international marketplace, CME brings together buyers and sellers on CME Globex electronic trading platform and on its trading floors. CME offers futures and options on futures primarily in four product areas: interest rates, stock indexes, foreign exchange and commodities. The exchange moved about $1.6 billion per day in settlement payments in the first half of 2005 and managed $43.7 billion in collateral deposits at June 30, 2005, including $4.0 billion in deposits for non-CME products. CME is a wholly owned subsidiary of Chicago Mercantile Exchange Holdings Inc. (NYSE, Nasdaq: CME), which is part of the Russell 1000(R) Index.
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