Dairy exchange gets liquid in Germany
Liquidity on dairy contracts has risen significantly in the last quarter of 2016, when more than 6,500 contracts were traded from the dairy complex on the Leipzig European Energy Exchange (EEX). This equates to a goods equivalent of around 32,500 tons. It is almost a doubling of the German contract volume compared versus the previous quarter.
Total volume traded in German dairy products at the EEX in 2016 was more than 82,000 tons, while in the first quarter of 2017 milk products, with a product equivalent of 30,840 tons, were traded at the EEX in Leipzig.
This is a sign that the market for futures is becoming more and more liquid, experts say. “Liquidity is an essential prerequisite for a sensible use of stock exchange hedging,” says Alessa Drabandt, specialist for agro-food industry at Bremer Landesbank. “Many companies have already become active.”
The benefit for dairy is that “secured goods can be better financed,” she states.
