Interest in multi-asset trading has grown exponentially recently, the most recent example being today’s announcement by CME Group Inc (NASDAQ:CME) that the company, along with SGS, an inspection, verification, testing and certification company, today confirmed the opening of a new, state-of-the-art cocoa grading facility in Amsterdam.
Physically delivered, euro-denominated Cocoa futures were launched on CME Europe in March this year. Since launch it has traded more than 6,000 contracts and has over 1,000 contracts in open interest. This was complemented in June 2015 by the introduction of Cocoa options. Amsterdam was selected as one of three delivery ports for CME Group’s new Cocoa futures contracts.
Futures markets in cocoa are essential to manage risks in the complex supply chain involved in chocolate and related manufacturing across Europe. For a futures contract to be an effective hedge for physical cocoa, the process of sampling and grading cocoa held in storage must be rigorous.
“Opening a grading facility in Amsterdam puts this important function within close proximity of the key cocoa storage facilities, therefore improving the efficiency and cost effectiveness of the futures sampling and grading process,” said Cees Vermaas, CEO of CME Europe. “Our partnership with SGS helps to further ensure the integrity of the process, resulting in fair values for our clients and a more effective hedging tool for the cocoa market.”
“Delivering high quality services and fast turnaround times, our new grading facility puts SGS and CME Europe at the forefront of the European cocoa market,” said Albert Wesenhagen, Agricultural Business Development and Branch Manager, SGS. “Our highly trained personnel will conduct intake supervision, as well as all testing and grading in accordance with CME Europe criteria and procedures and FCC rules.”
For the official announcement from CME, click here