NZ's Nui Markets partnership to reshape dairy trade

A new partnership between Nui Markets, Interfood, and StoneX is set to revolutionise the Mexican dairy market with the development of a new futures curve.

This collaboration aims to create a unique dual-stream buy/sell platform focused on the trade of non-fat dried milk (NFDM) between North America and Mexico, promising enhanced trade outcomes and better service for Mexican dairy customers.

Interfood is collaborating with New Zealand's Nui Markets to build a digital trading platform that consolidates the buying and selling of NFDM. Trade information from this platform will be shared on StoneXPlus, which provides exclusive dairy market insights. Ronald K. O'Brien II, President of Nui Markets Americas, highlighted the synergy within this partnership, stating, "This three-way partnership gives us a unique opportunity to combine Nui's index-linked trading technology and then layer our trade data with the global market intelligence of StoneX to build a more relevant futures curve for Mexican dairy customers working with Interfood."

Nui Markets, known for its expertise in digital agri-trade solutions, continues to adapt to the rapid digitisation of the commodity market. O'Brien remarked that it is no longer just about enabling trade but transforming how trading operations are conducted. He noted that innovative companies like Interfood and StoneX seek to leverage Nui's technology to enhance buy/sell and trade outcomes.

Manuel van Engelen, Commercial Director of Interfood Americas, emphasised the significance of establishing real-time online platforms for category-specific dairy trade. He explained that this would allow for the creation of more refined indices that better serve customers currently reliant on the CME or NDPSR for risk management. "Establishing an online platform where the category-specific dairy trade of NFDM happens in real-time will allow us to build new tighter indexes," he said.

To formulate a new index capable of settling financial derivatives, public, verifiable, and cross-checked information is essential. To this end, Nui and Interfood will transparently share trade data with StoneX. StoneX, a global financial services network, will play a crucial role in validating and referencing this information. Liam Fenton, Global Head of the Dairy & Food Group at StoneX, expressed enthusiasm for the project, stating, "We are eager to support any innovations that can help anticipate price changes, and we are excited to see the potential for us in OTC swap contracts as this platform develops."

This collaborative effort is expected to benefit all parties involved by enhancing their ability to manage risk, ensuring price and negotiation transparency, guaranteeing liquidity, and providing growing market intelligence. The partnership aims to provide better-informed decision-making tools for dairy market customers.

In the coming months, Interfood will work with Nui and StoneX to establish the digital trading platform, offering bi-weekly buy/sell opportunities for NFDM between North America and Mexico. There are also plans to expand the platform to other products and regions over time.