CME to Launch Its First-Ever Energy Contract

Ethanol Futures Scheduled to Launch on March 29th

Mar 03, 2005, 00:00 ET from Chicago Mercantile Exchange Inc.

    CHICAGO, March 3 /PRNewswire-FirstCall/ -- CME, the largest U.S. futures
 exchange, today announced its plans to list ethanol futures contracts, the
 exchange's first-ever energy contract.  The futures are scheduled to commence
 trading on March 29, 2005, and will trade on the CME(R) Globex(R) electronic
     Sempra Commodities, one of North America's largest full-service energy
 trading companies, will serve as the market maker.
     "As a result of the Clean Air Act, the ethanol industry has boomed over
 the past few years.  In 2004, U.S. ethanol facilities set new production
 records and consumers used more than three billion gallons of ethanol in their
 cars," said John Harangody, Director, CME Commodity Products.  "The launch of
 CME Ethanol futures, the first electronically traded ethanol contract, will
 provide the industry with a superior risk management tool, create trading
 opportunities for those looking to capitalize on the constant fluctuations in
 this market and potentially attract new customers to our markets."
     "We are pleased to have this opportunity to work with one of the world's
 most innovative and dynamic financial exchanges," said John Brooks, Vice
 President, Bio Fuels, Marketing and Trading, Sempra Commodities.  "This
 contract offers price transparency, the execution speed of electronic trading
 and a level playing field for all market participants.  Given CME's successful
 track record in launching new products, and the market need for sophisticated
 risk management tools, I am confident that CME ethanol futures will be well
     Ethanol is an alternative fuel produced by fermenting and distilling
 starch crops, usually corn, which have been converted into simple sugars and
 then to ethanol.  Most commonly used to increase octane and improve the
 emissions quality of gasoline, it has the potential to reduce dependence on
 oil.  U.S. federal legislation already includes provisions encouraging the use
 of ethanol and, internationally, other nations are launching initiatives to
 increase the use and production of ethanol.
     It is likely that 2005 will be another record-setting year for the ethanol
 industry. Currently, there are 81 ethanol plants nationwide with a combined
 capacity to produce more than 3.6 billion gallons of ethanol annually,
 according to the Renewable Fuels Association (RFA). Sixteen ethanol plants are
 under construction and two major expansions are under way. When those projects
 are finished, RFA estimates that the ethanol manufacturing industry will have
 a total production capacity of 4.35 billion gallons annually.
     Following are the specifications for the contract:
     Contract Size:                 30,000 U.S. gallons; +/- 5% variation in
                                    delivery unit without penalty, with payment
                                    based on exact quantity delivered
     Quotation:                     Dollars per gallon
     Quality Specification:         ASTM D4806, including Appendix X2 for
                                    California Ethanol Requirements
     Quantity Specification:        Measured at 60 degrees F using Table 6B of
                                    ASTM D1250
     Tick Size:                     $.001 per gallon ($30 per contract)
     Daily Price Limit:             No price limit in the front month during
                                    the last 5 days of trading;
                                    $.10 per gallon ($3,000 per contract) above
                                    or below the previous day's settlement
                                    $.20 per gallon ($6,000 per contract) after
                                    three consecutive limit-up or three
                                    consecutive limit-down settlements in the
                                    contract month nearest to expiration that
                                    is subject to a price limit
     Position Limits:
     -- Any Month except Front
        Month                       1,000 contracts
     -- Front Month                 500 contracts during last 15 trading days;
                                    250 contracts during last 10 trading days;
                                    100 contracts during last 5 trading days
     Contract Months Traded:        All 12 calendar months with 12 consecutive
                                    contracts listed for trading at all times;
                                    3 consecutive contracts listed until after
                                    first two expirations
     Termination of Trading:        Last business day of the calendar month
                                    prior to the contract month
     Final Settlement:              Physical delivery; on track via loaded tank
                                    car at shipping origin
     Freight Basing Point:          Chicago
     First Notice Day:              First business day of the contract month
     Last Notice Day:               Last business day of the contract month
     Trading Hours:                 Monday-Friday, 9:05 AM to 1:30 PM Chicago
     Trading Venue:                 CME Globex(R) only
     No-Bust Range:                 $.049 or less
     Price Bands:                   $.10 for outrights, $.05 for spreads
     CME will also offer a six-month fee waiver for all market participants and
 block trading with a minimum quantity threshold of 20 contracts.
     Chicago Mercantile Exchange Inc. ( ) is the largest
 futures exchange in the United States.  As an international marketplace, CME
 brings together buyers and sellers on CME Globex(R) electronic trading
 platform and on its trading floor.  CME offers futures and options on futures
 primarily in four product areas:  interest rates, stock indexes, foreign
 exchange and commodities.  The exchange moved about $1.5 billion per day in
 settlement payments in 2004 and managed $44.1 billion in collateral deposits
 as of Dec. 31, 2004, including $3.1 billion in deposits for non-CME products.
 CME is a wholly owned subsidiary of Chicago Mercantile Exchange Holdings Inc.
 (NYSE:   CME), which is part of the Russell 1000(R) Index.
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SOURCE Chicago Mercantile Exchange Inc.