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The Yield Podcasts

New derivatives market emerging for Australian wheat

November 08, 2016 (4:13 mins)



Physical Australian wheat has typically been traded at a fixed price or against the Chicago Board of Trade, while hedging has been done against CBOT or MATIF futures. Both of these markets, however, are not without basis risks when compared to Australian export prices.

In this podcast, S&P Global Platts editors Julien Hall and Alexis Gan examine how two recent cash-settled swap trades for Australian wheat signal the emergence of a new derivatives market sans basis risk, and how this new way of pricing may be used by traders and farmers for hedging.

Related news:Louis Dreyfus, Cargill trade 1st Australia wheat swap settled against an export price index


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