Fertiliser futures contracts now available to producers

Published 18 November 16

Euronext, a European stock exchange, recently announced the introduction of a futures contract for the European fertiliser market.

A key feature of this contract is that it is physically settled (where the producer who purchased the contract takes physical delivery of the commodity) with the delivery point in Rouen, France. Whereas, fertiliser futures contracts on the Chicago Mercantile Exchange (CME Group) are financially settled, which is more suitable for investors or speculators.

Contracts can be purchased for March, June, September and November, expiry dates over a two year horizon, with the first contract due to expire in March 2017. Its attractiveness to agricultural producers may be helped by each contract consisting of 30 metric tonnes of product, making the contract more viable to adopt from a quantity perspective. As a result, tools such as this (if used appropriately) can help producers shield their businesses from fluctuations in input prices.

Click here for more information on the contracts and specifications.