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----- Original Message -----
From: "Daniel Goncharoff" <thegonch@xxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Friday, October 19, 2001 12:09 PM
Subject: [RT] Wine Futures
> 10 October - The combined Paris, Brussels and Amsterdam bourse,
> Euronext, has started trading its wine futures contract, Winefex, after
> its launch date was postponed due to the September 11 terrorists attacks
> in the US. The publicly quoted exchange said it is trading between five
> and 10 lots a day at around 38 euros a bottle, and that it expects
> activity to pick up over the next two months.
>
> The contracts for fine Bordeaux wines en primeur - which are delivered
> in November two years after the grape harvest - run for 28 and a half
> months from the July prior to the relevant harvest, giving scope for
> hedging and speculation based on late summer weather conditions.
>
> Winefex futures contracts cover three price bands of fine red Bordeaux
> wines, including Graves, Saint Emilion and Saint Julien, with each
> contract traded for five cases of 12 bottles of 75cl. Although two
> London-based companies, WorldwineXchange and Bordeaux Wine Index, have
> unveiled plans to launch wine derivatives, Winefex is the only contract
> currently available.
>
> Sam Mezrahi, head of business development for Winefex, told RiskNews
> that while most of the business has originated from French wine traders
> keen to hedge their positions, a few contracts have also been bought by
> German brokers. He added that French and English specialist fine wine
> retailers have also expressed an interest in the derivatives contracts,
> as have French retailers such as the supermarket chain Carrefour.
>
> Mezrahi admitted that although the contracts lack liquidity, sufficient
> volatility is present. "Hedge funds have expressed an interest in using
> Winefex but they want to wait two or three months to get a feel for the
> product," he added.
>
> Potentially, airlines could be the largest users of the contracts.
> "Initially we thought that airlines such as Air France - which buys up
> to 50,000 bottles of wine a year - would benefit from using Winefex for
> hedging. But since the September 11 terrorist attacks, I think airlines
> have other issues on their minds," said Mezrahi.
>
>
> Paul Lyon
>
>
>
> Back to main headlines
>
>
>
> © Risk Waters Group, 2001
>
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>
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