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Chicago to trade KC wheat options

06/04/2013 @ 9:12am

CME Group, the world's leading and most diverse derivatives marketplace, today announced it has expanded its agricultural options offering through the introduction of three new options on the recently-acquired KCBT hard red winter (HRW) Wheat futures contracts. KCBT Weekly Wheat Options, KCBT-CBOT Wheat Spread Options and MGEX-KCBT Wheat Spread Options will be available for trading on July 1, pending CFTC review.

"Since our acquisition of the KCBT late last year, we've taken a number of steps to grow the existing KCBT futures and options contracts," said Tim Andriesen, Managing Director, Agricultural Commodities & Alternative Investments, CME Group. "We also committed to develop new and innovative options on KCBT wheat futures to provide additional trading and spreading opportunities for our wheat customers. The introduction of these new products expands our options offering and will benefit customers of both varieties of wheat, while further solidifying our role as the leading marketplace for the trading of deep and liquid wheat benchmarks."

KCBT Weekly Wheat Options will provide HRW wheat customers with a cost-effective tool for managing event risk, such as weather and USDA reports. These options will be available for trading on the Chicago trading floor and CME Globex, and will be listed with and subject to the rules and regulations of KCBT. Weekly options on CBOT corn, wheat and soybean futures were previously introduced in June of 2011.

Additionally, KCBT-CBOT Wheat Spread Options and MGEX-KCBT Wheat Spread Options will be available for trading on the Chicago trading floor and CME Globex, and will be listed with and subject to the rules and regulations of CBOT and KCBT respectively. These two new inter-market spread options, and the existing MGEX-CBOT Wheat Spread Options, will enable agricultural participants to manage the risk associated with the price differentials inherent between the hard red spring (HRS), soft red winter (SRW) and HRW varieties of wheat.

KCBT Wheat futures and options will transition to the CME Group Chicago trading floor on July 1, when they will begin trading alongside CBOT soft red winter (SRW) wheat futures and options.

As the world's leading and most diverse derivatives marketplace, CME Group (www.cmegroup.com) is where the world comes to manage risk. CME Group exchanges offer the widest range of global benchmark products across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. CME Group brings buyers and sellers together through its CME Globex(R) electronic trading platform and its trading facilities in New York and Chicago. CME Group also operates CME Clearing, one of the world's leading central counterparty clearing providers, which offers clearing and settlement services across asset classes for exchange-traded contracts and over-the-counter derivatives transactions. These products and services ensure that businesses everywhere can substantially mitigate counterparty credit risk.

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