CME to Offer Biodiesel, Ethanol RIN Futures Contracts

John Davis

CMEGroupTrader CME Group will be offering nine new futures contracts for Renewable Identification Numbers (RINs) for biodiesel and ethanol, among other renewables. This company news release says they’ll be listed by and subject to the rules and regulations of NYMEX.

“With the recent increase in volatility in RINs prices, we’ve seen strong interest from our customers and other market participants for cost-effective ways to manage their risk in this market,” said Gary Morsches, Managing Director Global Energy, at CME Group.

“As the most actively traded marketplace for the benchmark RBOB Gasoline and ULSD Diesel contracts, our new RINs futures contracts will be a strong complement to our existing suite of products and will allow our customers to take advantage of reduced capital requirements and margin efficiencies.”

The new RINs contracts will be available for trading starting May 13, 2013, and will allow customers to hedge risk in three types of renewable fuels:

• D4 Biodiesel

• D5 Advanced Biofuel

• D6 Ethanol

They’ll be settled based on Argus Media’s prices for RINs and are touted as a useful hedge for the price risk associated with the Renewable Fuel Standard (RFS2).

Biodiesel, Ethanol, RFS, RINS