The status of the long-awaited futures trading contract in apple-juice concentrate hasn’t changed. It’s still coming “soon.”

“We are extremely close to being there,” said Rita Maloney, with Minnesota Grain Exchange, which is the principal futures and options market for hard red spring wheat and is developing the apple juice concentrate trading system. She delivered a similar message last year to attendees at the U.S. Apple Association outlook and marketing conference.

Kevin Barley, with Morgan Stanley Smith Barney in Orlando, Florida, who focuses on citrus risk management, chaired a committee that nearly five years ago began to investigate the potential for a futures market for apple juice concentrate. Two years ago, that committee chose MGEX as the trading exchange.

Since then, Minnesota Grain Exchange has developed the standard contract size and quality attributes of the concentrate it will trade, developed a sampling and testing protocol that will be carried out by USDA inspectors, developed a system for reporting of cash price transactions in concentrate, and is working on the final step—establishing warehouses to serve as delivery points in the event contracts do result in delivery.

“Currently, there is not a sufficient number of warehouse meeting all MGEX requirements,” Maloney said. “We continue to seek new delivery locations.”

Those interested in this market can learn about it on the Web at www.mgex.com/ajc.

“This will be a better way to manage your price risk,” Barley said.

Concentrate makers are vulnerable to losses in inventory value after they pay for apples and make the concentrate. Bankers become reluctant to make capital and operating loans. Forward contracts have not greatly reduced the risks, Barley said.

The apple juice concentrate market has been volatile, largely because of the large role of imports, which made up 82 percent of U.S. apple juice consumption last year, according to USDA figures. The United States uses 15 percent of its apple crop for juice and produced 115.8 million gallons of it last year. It imported 541.1 million gallons (in the form of concentrate), three-fourths of it from China.

The value of annual world production of apple juice concentrate is estimated at $3.2 billion.