Euronext Chooses the Milky Way, Launches New Dairy Derivatives

Euronext exchange has announced an addition to its offering, launching a comprehensive dairy derivatives complex which is slated for Spring

milkEuronext exchange has announced an addition to its offering, launching a comprehensive dairy derivatives complex which is slated for Spring 2015, pending regulatory review.

Euronext is an assortment of multiple exchange and asset class outlets, having recently reported its Q3 2014 financial results showing a revenue growth of 10.3% YoY.

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In terms of the new offering, the complex will focus on three dairy products that are presently traded in Europe and abroad, i.e. butter, skimmed milk powder and whey powder. Milk powder prices have been a point of interest in recent months, coupled with its impact on currencies such as the New Zealand dollar (NZD).

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Moreover, the dairy derivatives effectively allow European dairy locales to hedge their exposure to prices, which have been in a state of flux during an unusually volatile market. The move also comes during a time when milk quotas are poised to expire in the European market.

According to Michel Portier, CEO of European leading agricultural consultancy, Agritel, in a statement on the launch, “This is an important initiative as it provides a set of tools to address the alignment of dairy prices in Europe with the international market at a time when the dairy industry will need to adapt to the end of quotas. We are delighted to have been associated with this industry-driven initiative and fully support Euronext in this endeavour.”

“This is yet another example of Euronext’s innovative approach to economic situations where our clients are seeking solutions for their hedging needs. As the leading Eurozone exchange, we are ideally placed to service the needs of the industry at this crucial time in its history when European milk quotas end, by offering a full dairy complex,” added Olivier Raevel, Head of Commodities at Euronext.

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