Q4 2020 Ag Update

South American Soybean futures build momentum

Since launching on September 21, South American Soybean futures volume has continued to grow. A month into trading, open interest has reached over 300 contracts and average daily volume (ADV) has increased to 102 contracts. Market participants from across the globe have started to capitalize on trading opportunities provided by this new contract. 
 
Benefits include:

  • A more effective hedge for South American producers, exporters, and importers of Brazilian soybeans ‒ as it reflects export price at the Port of Santos 
  • An opportunity to trade the spread between North American and South American soybeans, and effectively, the South American soybean basis
  • Available for screen trading on CME Globex or block trade reporting via CME ClearPort

Source: CME Group

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White paper: Relationship Between Global Soybean Prices

The latest white paper from CME Group researchers, Alison Coughlin and Dominic Sutton-Vermeulen, addresses the relationship between soybean prices in major importing and exporting countries and the usefulness of a cleared South American Soybean futures contract for managing global soybean price risk.

Read now


Pricing, volatility, and strategy tools

CME Group has a suite of free QuikStrike tools to calculate theoretical prices and Greeks on CME Group Agricultural options, chart volatility, and correlations — and to test strategies in simulated markets.

Explore Options Strategy Tools


Pork Cutout futures and options launch on November 9

As hog and pork markets have evolved, producers have diversified the formula contracts used to price their livestock. Cash-settled Pork Cutout futures and options will be complementary to the successful Lean Hog complex, providing the market with the ability to manage risk and discover price throughout the value chain.


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View the current version and an archive of the Ag Update online at cmegroup.com/education/ag-update.html

Data as of October 10, 2020, unless otherwise specified.

New open interest records for Soybean futures

  • Increased uncertainty has led to higher levels of volatility within the Soybean market, driving Soybean futures open interest over 1M contracts on October 14 — setting multiple open interest records in October.

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Ag options update

  • Weekly options saw the highest monthly ADV of the year (10K) with Weekly Soybean options hitting an all-time ADV record of over 2K.
  • Soybean Meal options had the third highest monthly ADV on record with an uptick in implied volatility and call skew during September.
  • November Soybean call skew is at record highs, as futures rallied 88 cents during September.

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Black Sea futures and options

  • Black Sea futures and options contract volume totaled 230K by the end of September — up 35% compared to 2019.
  • Black Sea Wheat futures volume up 73% YTD September compared to 2019.
  • Record Black Sea futures and options monthly volume (34K) in August. 
  • Black Sea Wheat futures open interest exceeded 30K in July, hitting a daily record of 4,749 lots on September 1.

Learn more about hedging with Black Sea Wheat futures

UAN FOB NOLA futures launched September 21

  • With the launch of UAN futures, the entire Fertilizer suite is available as futures contracts, improving access for market participants.
  • The CME Group Fertilizer futures suite includes: Urea US Gulf, Urea Egypt, UAN NOLA, DAP NOLA, Urea Brazil, and MAP Brazil.
  • View the Fertilizer broker list

Explore Fertilizer futures