The power of Brazilian agribusiness is revealed in the position occupied by Brazil in the global ranking of grain and oilseed production. In recent years, the country has become the world's largest soybean exporter.
As a partner of choice in this effort, B3 entered into an agreement with the Chicago Mercantile Exchange (CME) to jointly launch a new risk management tool for companies trading in the soybean segment in Brazil and in the international market: the Soybean Futures contract referenced in Brazil.
The purpose of the new contract, scheduled to be available for trading by the third quarter of 2020, is to meet the demand for hedge instruments by setting a benchmark for Brazilian soybean export prices (port of Santos). The contract will benefit directly agricultural companies operating in the soybean sector in South America.
The new Soybean Futures contract is part of the cooperation agreement signed in 2007 between B3 and the CME Group which provides for the development of technology services and soybean futures contracts traded on both exchanges to connect global players in this market to Brazil’s agricultural sector.
This is a key aspect, as both the Brazilian and the U.S. markets have their own production and export dynamics causing players to look for ways to manage their risk exposure in both regions.
As well as the Chicago Mercatile Exchange, the CME Group owns three other major exchanges in the USA: New York Mercantile Exchange (NYMEX), Chicago Board of Trade (CBOT) and the Commodities Exchange (COMEX).
The launch of the new Brazil Soybean Futures contract will occur following approvals from regulatory agencies and will be announced in due course. If you have any questions, please contact your RM.