VTB Capital launches Russia's first grain delivery futures

дата21.12.2020

VTB Capital in collaboration with the Moscow Exchange has developed Russia’s first wheat delivery futures. Trading in these futures contracts will begin on the Moscow Exchange derivatives market on December 21, 2020. VTB Capital will act as the main market maker under the contract.

The new instrument will be of interest to various categories of market participants: agricultural producers, processors, grain exporters, as well as banks, brokers and their clients.

Futures are quoted in rubles for one ton of 4th class grains. The contract volume is 25 tons. The contract provides for the delivery of wheat in March, September and December to the Voronezh Region silos. At the start trading, the Rossoshansky silo and the Povorino Grain Base will act as registered silos for delivery. In the future, it’s planned to expand the list of silos.

Atanas Djumaliev, Head of Global Commodities at VTB Capital: “The launch of the grain delivery futures is an important step in the development of the Russian derivatives market. Russia is a major producer and consumer of grain, and that is why we decided to launch a contract with local delivery. At the same time, we expect that in the future this instrument will also be of interest to large global players who are looking for additional opportunities to hedge risks. We are currently continuing to work on developing infrastructure and expanding our investor base base, and we are confident that VTB Capital’s international experience and expertise in the financial and grain markets will allow us to create a liquid contract that will become the main price benchmark for Russian grain, both locally and globally.”

Vitaly Sergeychuk, CEO of Demetra-Holding PLC: “The launch of such an instrument is an important step for the development of the entire industry. The use of futures will allow producers, exporters and domestic consumers of Russian grain to get transparent pricing and reduce the costs of finding and checking counterparties. I hope that in the future this instrument will be in demand and will compete with foreign trading platforms in the setting the prices on the grain market.”

Igor Marich, Member of the Executive Board and Managing Director for Sales and Business Development of the Moscow Exchange: “Russia is the world’s largest grain exporter, and Russian wheat plays an important role in shaping the balance of the global grain market. However, so far in Russia there was no universal price benchmark for grain. We hope the new futures contract will become such a benchmark and provide grain market participants with a convenient and reliable mechanism for hedging price risks.”

Reference

The futures contracts on the derivatives market will be cleared by the National Clearing Center (NCC), which acts as the central counterparty for the Moscow Exchange markets.

Delivery will take place on the spot market of the National Commodity Exchange (NCE, part of the Moscow Exchange Group). Only participants of trading and clearing of the National Commodity Exchange spot market will be able to enter the delivery. The minimum delivery volume is at least 200 tons (8 futures contracts). Clearing of delivery transactions will be carried out by the National Settlement Depository.