The Chicago Mercantile Exchange (CME) has broken its agreement with the Met Office, the UK weather information service, and the Met's own joint venture company, Weather Xchange, and is to debut its own European weather derivative contracts.

The trio had agreed a joint venture only last month to develop a new family of European weather futures and options contracts. According to sources at the CME they were unable to reach a definitive agreement within the requisite time for launching the European products.