CHICAGO, Feb 22 (Reuters) - Whey, a high-protein dairy product best known from the Little Miss Muffet nursery rhyme, has become a popular addition to athletic diets and will soon be trading at the world's largest financial exchange.Fifty years ago whey, the liquid remaining after milk has been curdled and strained and is a by-product of the manufacturing of cheese, was largely discarded or used as hog feed, said Ed Jesse, a University of Wisconsin dairy economist.Today, amateur and professional athletes are eating it in protein bars or drinking it in sports drinks because it can rebuild muscles and speed recovery after workouts.This use is one reason whey prices have sped higher.In January, the price averaged nearly 51 cents per lb, up 47 percent from a year ago, and more than double two years ago, according to data compiled at the University of Wisconsin."Recent research has shown that use of whey before and after exercise can improve recovery, rebuild muscle, build more muscle, and thus enhance performance," said Jeff Kotterman, director of the National Association of Sports Nutrition.Unlike meat or other protein sources, Kotterman said whey has become popular because it is easily absorbed by the body.WHEY PRICES HIT THE BIG TIMEThe Chicago Mercantile Exchange <CME.N>, the world's largest financial exchange, on Thursday said it will add a whey market to its basket of agriculture and financial products.Trading in dry whey futures will start March 19 on the CME's Globex electronic trading platform.Dry whey has been used in a variety of foods such as crackers, breads, cereal, commercial pastries and animal feed. But more recently a whey derivative which is high in protein and low in fat has been used in popular energy and power bars as well as protein drinks and powders, the CME said."As a result, dry whey has become a volatile commodity. CME can provide buyers and sellers of dry whey future price protection, hedging opportunities as well as a mechanism for price discovery," John Harangody, the CME's director of commodity products, said in a statement.EXPORTS ARE WAY UPIn addition to sports applications, exports of whey have jumped in two years due a drop in milk production in Europe and Australia and attractive foreign exchange rates."I think it has to do mostly with exports, with the U.S. dollar being as cheap as it is and it being a readily available product," Dave Kurzawski, senior broker at the Downes-O'Neill brokerage firm, said of the recent jump in demand.Whey is being shipped overseas as a substitute for other dairy products, according to the University of Wisconsin's Jesse."EU production is down substantially from a year ago. Australia has some real drought problems and has not been producing a lot," said Jesse.In 2006, the United States exported nearly 336,300 metric tons of whey, compared with 269,070 in 2005, and 201,400 in 2004.
