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Inside Potatoes

No flowers at the end of an eventful potato year

June 6, 2019 - 6 comments

Trading of the June 2019 contract on the potato futures market has been remarkable. It is not often that a futures market contract approaches expiration with so little turnover. How was that in previous years?

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Thursday, June 6, was previously designated as the day on which the potatoes from the 2018 harvest could be traded on the futures market for the last time. That point was reached at 16:00 PM. However, with a bid of €30,30 and €31,50 and no contracts traded, it was a sad ending to the futures trade. The harvest year should provide sufficient starting points for trade, but in recent weeks the parties have held their positions.

June 2019 2018 2017 2016 2015 2014
Turnover last day   49 5 36 17 26
Outstanding 968 1.368 1.318 861 1.159 670
Cash settlement June €31,20 €5,30 €26,00 €22,10 €6,70 €5,90
Cash settlement April €27,90 €5,80 €22,10 €15,30 €3,20 €9,80

Cash-settlement
The trading on Tuesday, June 4, was remarkable, because the closing quotation saw a turnover of 25 contracts, up to €30,10. With the certainty of a small minus in the cash settlement, selling below €31 did not make sense.

While no trading took place on the last trading day, the volume of open contracts (968 pieces) is at a normal level. The final cash settlement for the June contract amounts to €31,20. The 2014 season also shows that this does not always have to be higher than the final cash settlement of April. In that year, the June contract ended €3,90 below that of April.

Harvest 2019
In the meantime, all eyes are again on the futures trading of the 2019 harvest. The rain has contributed to the market falling to the €15 level. However, it is too early to definitively choose a direction, we will have to wait until at least week 27.

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