CME Group has agreed to buy hard red winter wheat futures exchange Kansas City Board of Trade for $126m in cash as the derivatives-exchange giant looks to expand its agricultural product offerings.

"While the CBOT and KCBT Wheat contracts are very distinct products with different uses, the ability for producers and commercial participants to hedge their risk in both key benchmarks in one place will produce cross-margining benefits and other capital efficiencies," CME chief executive Phupinder Gill said.