News

CME takes steps to address cattlemen’s concerns

The CME Group is taking steps to address cattlemen’s concerns with extreme volatility in the cattle futures markets.

One of the changes will be a reduction in the CME’s livestock trading hours.

“We’ll be removing the afternoon session—the current 1:00 to 4:00 p.m. session—and concentrating trading during the 8:30 a.m. to 1:00 p.m. Central time hours,” says Dave Lehman, the CME’s director of commodity research and product development.

That change takes effect February 29th.

Lehman says the CME has also added cattle and hog futures products to it messaging efficiency program, “where we monitor the amount of messaging in these contracts to ensure that there isn’t excessive messaging which is perhaps causing misinformation or distortion in the markets.”

Lehman tells Brownfield they are also looking into whether a discount is warranted at their Worthing, South Dakota delivery point for live cattle futures. In addition, the CME will form a working group with the National Cattlemen’s Beef Association to discuss other possible changes, including the use of so-called “circuit breakers”.

AUDIO: Dave Lehman