The Commodity Markets Oversight Coalition, consisting of trade groups, faith-based organizations and consumer groups that represent commodity hedgers and commodity end-users, is urging the Commodity Futures Trading Commission to move forward with proposed limits on speculation in the commodity futures market. The coalition also supports a proposal that would strengthen the CFTC's market surveillance regime and give CFTC commissioners discretion to act immediately to reduce large, controlling positions in a given commodity.
R-CALF USA CEO Bill Bullard says they are concerned that speculation – though important to provide the cattle futures market with liquidity – distorts the cattle futures market when it is excessive, thus harming independent cattle producers who depend on the futures market to hedge their risks. The organization believes the cattle futures market has become overly volatile and disassociated with supply and demand fundamentals.
In a recent Congressional hearing, the coalition called the proposed limits on speculation an important first step and said it would provide the CFTC with suggestions during the comment period on how the rule might be improved and implemented to better protect hedgers and consumers.
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