Euronext to launch wood pellet futures contract

By Erin Voegele | September 25, 2015

Euronext has announced plans to launch a new wood pellet commodities futures contract this fall, subject to regulatory approval.  Aimed at producers, wholesalers and retailers, the physically settled contract targeting the residential heating sector will allow the industry to hedge its positions.

“This is an important initiative for the pellet industry as it provides a clear response to the high volatility we have seen recently in pellet pricing,” said Christian Rakos, president of the European Pellet Council and president of Propellet Austria. “It will offer a hedging tool that will allow our members to manage their risk from production to purchase to sales.  The European Pellet Council is delighted that Euronext will be using our ENplus A1 certification as a base for the underlying of its future contract. We believe this initiative will contribute to reinforce and structure the sector.”