CME Group Expands Centrally Cleared OTC Agricultural Offering with Eight New Grain and Oilseed Swaps

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Jan 23, 2012, 01:30 ET

CHICAGO, Jan. 23, 2012 /PRNewswire/ -- CME Group, the world's leading and most diverse derivatives marketplace, today announced it has expanded its centrally cleared, over-the-counter (OTC) agricultural swap offering through the introduction of eight new grain and oilseed swaps. The new swaps will be available for clearing on February 13, pending regulatory review. Among the offering are five new bullet swaps and three additional calendar swaps, which are listed with, and subject to, the rules and regulations of CBOT.

Additionally, these OTC agricultural swaps are the first to be introduced by any exchange following a new CFTC agricultural swap rule that took effect on December 31, 2011, allowing certification of agricultural swap products under new regulations beginning in January 2012.

"These new agricultural swaps will provide customers with even greater flexibility to manage price risk while accessing the world's deepest and most liquid grain and oilseed markets," said Tim Andriesen, Managing Director, Agricultural Commodities and Alternative Investments, CME Group. "Customers have expressed strong interest in centrally cleared agricultural swaps as a way to complement our underlying futures. We're confident these new financially settled swaps will provide customers with another set of versatile hedging tools to manage their risk."

Calendar swaps, which settle based on the average of the underlying futures settlement prices over a one-month period, will be offered on Soybean Meal, Soybean Oil and the Soybean Board Crush to complement the exchange's current lineup of cleared OTC calendar swaps. Bullet swaps on Corn, Wheat, Soybeans, Soybean Meal and Soybean Oil represent the first bullet swap offering on agricultural futures at CME Group. These bullet swaps will be European-style and will settle to the corresponding futures settlement price on the swap's final settlement day.

The addition of Soybean Board Crush swaps will, for the first time, allow market participants to take advantage of the spread relationship between the underlying Soybean, Soybean Meal and Soybean Oil futures using one product.

For additional information on OTC agricultural swaps please visit - www.cmegroup.com/trading/agricultural/agricultural-swaps.html.

As the world's leading and most diverse derivatives marketplace, CME Group (www.cmegroup.com) is where the world comes to manage risk. CME Group exchanges offer the widest range of global benchmark products across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. CME Group brings buyers and sellers together through its CME Globex® electronic trading platform and its trading facilities in New York and Chicago. CME Group also operates CME Clearing, one of the largest central counterparty clearing services in the world, which provides clearing and settlement services for exchange-traded contracts, as well as for over-the-counter derivatives transactions through CME ClearPort®. These products and services ensure that businesses everywhere can substantially mitigate counterparty credit risk in both listed and over-the-counter derivatives markets.

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SOURCE CME Group