About CME Cash-Settled Butter Futures

CME® Cash-Settled Butter futures are cash-settled contracts traded exclusively on CME Globex®, CME's electronic trading platform. This contract was designed to meet the needs of industry participants who prefer the features of cash settlement over the current physical delivery contract.

In addition, the contract size of the new CME Cash-Settled Butter futures is 20,000 pounds of Grade AA butter versus the 40,000 pounds for the existing CME Butter contract. All CME Cash-Settled Butter futures contracts open as of the termination of trading shall be cash-settled based upon the first-released USDA monthly weighted average price of butter in the U.S.

This contract provides segments of the food industry, such as ice cream producers, a liquid, cash-settled hedging mechanism. CME Cash-Settled Butter futures will enable buyers in this industry to hedge their exposure to price fluctuations in butterfat. In addition, butter producers and other food industry participants will be able to manage their risk with this new contract.

Modern Dairy Markets LLC will be the market maker for this new contract, and will help ensure liquidity in this new contract and maintain a continuous, transparent and competitive market.