Livestock Futures are Derivatives Contracts that provide market participants with a tool for hedging against price risk. The livestock contracts are priced and traded in Rands per kilogram. In partnership with Red Meat Abattoirs Association (RMAA) and its members the contracts are cash-settled, referencing two-weeks of transactional data for the specific expiry and easily accessed via JSE commodity derivatives members.
Who is this for?
Typically, this product is used by those with a vested interest in protecting themselves against adverse price movements in the South African Livestock market. Hedgers may be commercial livestock producers, feedlots, abattoirs and consumers. Producers can employ a short hedge to lock in a selling price and end-users can use a long hedge to secure a purchase price. Speculators hoping to make a profit on short-term movements in the Futures Contract price also make use of this product.
- Secure, affordable and flexible.
- Derivatives contracts enable institutions to fund producers who hedge their price risk.
- Provides a platform for price discovery and efficient price risk management for the Beef market in South Africa.
- Transparent as trade takes place on an electronic platform.
- All transactions are guaranteed through the derivatives clearing structure.
- By nature, derivatives can be risky and should be not be tackled by novice investors.
How to get it?
To access this product, register as a client with an authorised JSE Commodity Derivatives Trading Member, deposit the required initial margin and sell or buy according to your needs.
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