Intercontinental Exchange became the center of global trading in soft commodities with its acquisition of the New York Board of Trade in 2007. Now known as ICE Futures U.S., the exchange offers futures and options on futures on soft commodities including coffee, cocoa, sugar, cotton and frozen concentrated orange juice. Following its acquisition of NYSE Euronext in 2013, ICE Futures Europe now trades London softs markets including cocoa, Robusta coffee, and white sugar.
Due to Cocoa's seasonal demand cycles and concentrated production sources, the cocoa market is subject to a high degree of volatility, presenting hedging and trading opportunities for cocoa traders around the world.
Volatility in the coffee market has been historically greater than that of other soft commodities markets, often triggering increased levels of activity from both hedgers wishing to lay off risk and financial participants willing to take on those risks. The result is more bids and offers, providing a critical mass of liquidity, hedging and pricing opportunities.
Sugar is one of the world's ten largest agricultural futures markets and the world looks to ICE to price this vital commodity. A large set of commercial market participants, including producers, exporters, candy manufacturers, trade houses and a diverse set of institutional participants underscores the importance of sugar futures and options markets ensuring highly efficient pricing and continuous liquidity.
Cotton's world-wide appeal and vulnerability to unforeseen natural and man-made events raises the economic stakes for this commodity, attracting market participants from across the globe.
ICE Futures U.S.
/ Cotton No. 2
Weather sensitivity, when combined with the competitive global juice and beverage market, and rapidly-changing supply and demand, makes the price of orange juice extremely volatile. Since the great majority of oranges grown in the U.S. are turned into frozen or fresh juice, the price of orange juice is important. The ICE Futures U.S. FCOJ market provides critical risk management tools to an industry at extra risk when the wind blows or the frost forms.
ICE Futures U.S.
/ Frozen Concentrated Orange Juice (FCOJ)