Plans for the merged market include the development of trading in wheat futures across Europe to take advantage of the expected reductions in support for farmers under the Common Agricultural Policy, which will increase the demand for hedging.
Daniel Hodgson, chief executive of Liffe - the market famous for its open outcry dealings and the bright jackets worn by floor traders - said development of wheat futures would be complex.
This would be because of the variations in the types of wheat required by bakers in different countries, "but there is no doubt it is an opportunity for the exchange and it should have pan-European appeal".
The merger is through a pounds 10.3m offer by Liffe - the London International Futures and Options Exchange - for the London Commodity Exchange, which has traded coffee, cocoa and sugar since 1954.
The offer will be accompanied by an invitation to members of both exchanges to subscribe for new shares in Liffe at a price of pounds 15,000 each, which will give a right to trade commodities on the merged market. Of the LCE's 44 floor members, 29 are from the same organisations as Liffe members.
Robin Woodhead, chief executive of the LCE - who will remain as a consultant for six months after the merger - said, "Four years ago the LCE had a very difficult time. But we have had three successful years that have enabled the LCE to think about long-term planning. We came to the conclusion that we needed much greater resources to maintain and expand our expertise."
An outline agreement to merge with Liffe was reached last October, after discussions with other potential partners, including London's International Petroleum Exchange, ended.
The merged market will be at an expanded floor in Liffe's building by Cannon Street station in the City, or split between that building and the old Stock Exchange floor in Threadneedle Street, which Liffe is to take over from the autumn.
If the markets both fit into Liffe's present floor, the Stock Exchange floor may be used as an emergency back-up.
Mr Hodson made clear Liffe did not expect to make any radical changes as a result of lessons learnt from the Sumitomo losses on the London Metal Exchange.
Mr Hodson said 40 recommendations were made last summer by a global task force on the best practice for futures and options regulation.
"We looked at our practices in the light of those recommendations and we scored an 'A' star," he said.Reuse content