The U.S. Cattlemen’s Association says proposed changes to live cattle futures by CME Group will not address the concerns of producers across the country. CME group is considering switching to a cash settlement process for live cattle futures, the same settlement process for other livestock futures operated by CME. Modifications to the physical delivery process are also being considered. USCA Marketing Committee Chair Allan Sents explains “the need to evaluate the current state of the livestock marketplace is real,” but says the proposal is a step in the wrong direction. USCA says the proposed changes will do nothing to impact the amount of high frequency, overly speculative trading, which the organization says must be addressed to achieve market stability. USCA concludes “efforts must instead be made toward encouraging ‘long’ participation and addressing the many issues currently within the futures market, not the settlement process.”
From the National Association of Farm Broadcasting news service.