Futures Link Contract

The benefits of futures without the worry
The Futures Link Contract is designed for the Australian Wool Producer and provides a forward selling mechanism that allows both small and large marketable parcels of greasy wool to be forward sold at any time. 

The contract is not a traditional physical forward contract, but rather is a basis type contract, allowing the wool producer greater flexibility in the final wool type delivered. The contract price is based on either the SFE or Macquarie Bank futures market, thus allowing participants to access futures prices but without any of the associated requirements - no establishing an account, no margins calls, no brokerage and no worrying about when to close out the contract.
Key Benefits of the Futures Link Contract
Forward prices up to two years in advance
Small (20 bales) or large (>100 bales) marketable parcels can be sold with the contract. Wool producers therefore have greater flexibility and do not have to "over commit" and have to hedge the whole clip at once.
Fleece, pieces and bellies can be effectively hedged from 18 to 26 micron.
Futures prices without any of the associated requirements of a futures market - account set-up, margin calls, brokerage, and trade management.
Market orders can be left in the market, to ensure you obtain your price.
The volume of transactions allows the Futures Link Contract to be offered to wool producers at lower costs than an individual wool producer could trade futures. The benefit of futures without the worry.

You receive full market value of wool delivered - the transaction can be completed in either the auction system or settled via the industry 'P&D' report.
Minimise production risks that can be associated with traditional physical forwards - no penalties if you fail to deliver within the wool specifications on the contract.

To discuss the benefits further or for a contract price quote please contact us