CME Group reduces grain, oilseed trading hours

By MATTHEW WEAVER

Capital Press

The CME Group has announced it has received enough industry feedback to reduce its trading hours for grains and oilseeds.

In a letter to customers, CME Group Executive Chairman Terry Duffy and Chief Executive Officer Phupinder Gill said the change required approval from the U.S. Commodities Futures Trading Commission. The group is talking with its customer base over what the new reduced hours should be.

The National Grain and Feed Association in a press release called it a positive first step. The association will withhold further comment until it provides additional input to the CME Group on the details of the reduced trading hours.

The association will continue to work with the CME Group to address concerns over the release of USDA statistical and economic reports during electronic trading hours. Release of the reports could increase market volatility and be a disadvantage to some market participants with "unequal access" to USDA data because of lower Internet bandwidth speeds in rural areas, according to the association.

There are also concerns about volatile futures market moves immediately before and after the USDA reports are released.

Even though the CME Group's industry survey is under way, Duffy and Gill said there was enough feedback to merit the change.

"CME Group understands the frustration of many of our customers," they said in their letter, noting the group would consider a market pause during USDA reports to allow participants to evaluate the data. if all exchanges and trading venues do the same. A unifed market halt for all venues would benefit all customers by ensuring market liquidity for price discovery, according to the CME Group.

The group extended the number of hours from 17 to 21 in May 2012.