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AJC Update from MGEX

December 2010, Issue 3
In this issue
:: AJC Product Testing
:: USDA AJC Cash Price Reporting
:: AJC FAQ
:: About MGEX
Greetings!

Work on the Apple Juice Concentrate (AJC) contract continues and each week brings new milestones.  Outlined below is information on the United State
Department of Agriculture's AJC product testing and information on public pricing with a link to the most recent National Apple Processing report prepared by the USDA's Market News Service.  In this communication we are also introducing an "AJC FAQ" section, outlining some frequently asked questions surrounding the AJC contract.  These FAQs are designed to help you better understand how the AJC contract may fit into your company's risk management needs.  Email us with your questions and comments.   
AJC Product Testing

The United States Department of Agriculture (USDA) Processed Products Branch (PPB) and Science and Technology program (S&T) are each conducting quality and chemistry testing of Apple Juice Concentrate.  Tests can be done for acid, brix, turbidity, microbes and more, and performed to your company's specifications.  For information on AJC testing and other testing services, visit the USDA website or call PPB at (202) 720-4693. 
USDA AJC Cash Price Reporting

The Market News Service of the USDA is collecting and reporting AJC cash price transactions.  The information is available each week as part of the National Apple Processing Report.  This independent, transparent and reliable public pricing is something which never before existed in the AJC industry and is a key component of a successful futures contract.  The USDA report also includes other information on apples and the apple industry.

Many companies in the AJC industry have indicated a willingness to provide confidential price information to Market News Service.  To ensure your pricing is represented in the weekly USDA report, contact
Market News. 
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AJC FAQ
Frequently Asked Questions

Why is MGEX launching an Apple Juice Concentrate contract?
MGEX is always looking for opportunities to expand our trading, clearing and regulatory services.  In 2007, representatives from the Juice Products Association formed a subcommittee whose missionFAQ and mouse was to address the tremendous price risk in the AJC market and bring forth suggestions on how to manage that risk.  After much research and debate, the subcommittee's conclusion pointed to an AJC futures contract.  The search for a partner commenced and ultimately lead the subcommittee to MGEX. 
What are the requirements to trade on MGEX?
MGEX products trade electronically on the CME Globex platform.  To trade, you or your Futures Commission Merchant must have an account with an MGEX Clearing Member and meet appropriate margin requirements.  MGEX members enjoy many benefits including reduced exchange trading fees.  Contact us for more information on becoming an MGEX member. 
About MGEX 

MGEX is a Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO) established in 1881.  It is currently researching and designing an Apple Juice Concentrate contract with the assistance of the AJC industry.  MGEX is also the only market for Hard Red Spring Wheat (HRSW), National MGEX logoCorn Index (NCI), National Soybean Index (NSI), Hard Red Winter Wheat Index (HRWI), Hard Red Spring Wheat Index (HRSI) and Soft Red Winter Wheat Index (SRWI) futures and options.  To learn more about MGEX visit www.mgex.com.

Our next AJC Update will include more frequently asked questions and information on how to trade AJC.  We always welcome your feedback.    
Sincerely,

Rita Maloney
Director, MGEX