SFE Wool Futures Trading Strongly

Sydney Futures Exchange (SFE) wool futures, the commodity first traded by the Exchange when it opened in 1960, are continuing to experience strong trading growth 40 years later. The combined trades of SFE's three wool contracts in 1999 amounted to 20,943 futures and options contracts, an increase of 48.6% on 1998 volume - the equivalent of 52.3 million kilograms of wool with a nominal value of A$330 million. Individually, 4,106 Fine wool (19 micron) contracts were traded last year, up 101.2% on the previous year; Greasy wool (21 micron) rose 40% to 16,108 contracts; and the volume of Broad wool (23micron) contracts exchanged in 1999 amounted to 699, 40.9% more than 1998. Each wool futures contract is the equivalent of 2,500 kilograms of clean weight wool or approximately 20 farm bales. Trading in the first month of 2000 is equally strong, with a total of 1,381 wool futures contracts traded in January this year, almost 12% higher than for the same month last year. The growing demand for SFE wool futures reflects the increasing popularity among all types of wool market participants of using futures as a tool to manage price volatility.