Top 5 Reasons to Watch Short Dated New Crop Options at CME Group

Aug 28, 2013, 09:00 ET from CME Group

CHICAGO, Aug. 28, 2013 /PRNewswire/ -- As farmers prepare for harvest this fall, they will reach the culmination of what has been a strange production cycle. The year began with concern that the 2012 drought had left the ground without adequate moisture in many crop producing regions. That was followed by the spring's heavy rains and worry of a lost planting season. And finally, a dry summer looked like it could again damage final production. If a weather risk exists, grain producers have probably felt it in 2013.

A year with a lot of risk also means it has been a good year for increased risk management tools for producers. Primary among these has been short-dated new crop options (SDNCOs), a product that has helped manage the short-term risk associated with events like a USDA report or sudden heavy rain. And whether or not 2014 will be the roller coaster that 2013 has been, we expect producers and other ag market participants to continue their adoption of these products.

Since their launch in mid-2011, SDNCOs on corn, soybeans and wheat have surpassed more than 1.2 million contracts traded. The 2014 short-dated new crop corn, soybean and wheat options are now available for trading, so here are five reasons to watch their continued progress:

Short-dated new crop options on corn, soybeans and soft red winter wheat are listed with and subject to the rules and regulations of the CBOT. Short-dated new crop options on KC hard red winter wheat are listed with and subject to the rules and regulations of the KCBT.

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