Euronext touts growth in core agricultural contracts, cautious on new ones

Euronext ENX aims to build on last year’s record volumes for its main crop futures by attracting more non-European players like wheat importers in the Middle East, the exchange’s head of commodities told Reuters.

With the group prioritising its established wheat, rapeseed and maize (corn) markets for expansion, it is in no rush to launch new products, including in the Black Sea grain export zone, Euronext’s head of diversified services Camille Beudin, who is in charge of commodities products, said in an interview.

Euronext’s commodities business is dominated by its wheat futures (BL2c1), a price benchmark for the European market that represents nearly 80% of the total volume of agricultural trades on the exchange.

As with its rapeseed and maize markets, which are smaller but also expanding, the market operator sees its wheat futures connecting a large physical market with financial investors.

“Today, the milling wheat contract is not a purely French contract, it is a contract that has global scope and ambition and is becoming a true price reference at the global level,” Beudin said.

To boost participation outside Europe, the exchange is prospecting in regions including the Middle East, a major wheat import zone, as well as North and South America, he said, adding it also wants to expand use of options against its futures.

Euronext posted record volumes for its wheat, rapeseed and maize contracts last year. After 2024’s 30% growth, wheat volumes rose 15% year-on-year in the first quarter to also set a record for the period.

Lower fees since Euronext took over clearing for its own commodities contracts last year have boosted participation, Beudin said.

But Euronext is more cautious than in the past about expanding its offering of agricultural products.

For the Black Sea region, the exchange is still to decide on any potential services and is wary of diluting activity in its existing contracts, Beudin said.

Physical delivery for maize in Romania, as studied previously by Euronext, could create confusion given the exchange’s contract is based on French quality, he said, adding that many grain operators in the Black Sea region already use Euronext contracts via physical premiums.

U.S. rival CME Group CME has already developed Black Sea grain derivatives and is due to launch an EU rapeseed oil contract later in April.

Euronext saw no need to revive its scrapped rapeseed oil and meal contracts, which failed to generate liquidity, and no space for a sugar product given well-established futures on other exchanges, Beudin said.

The exchange sees stronger prospects for its salmon futures, launched last year and already showing sizeable open interest, with Beudin noting it benefits from an established market in Norway.

Tags: corn, wheat, rapeseed, rapeseed oil