By Jamie Martin
The National Grain and Feed Association (NGFA) has formally voiced its opposition to a proposal that would expand agricultural futures trading to a 24/7 schedule.
In comments submitted to the Commodity Futures Trading Commission (CFTC), the NGFA responded to the agency’s request for public input on the possible effects of around-the-clock derivatives trading.
The association, which represents commercial hedgers and other stakeholders who depend on agricultural futures markets to manage price risks, expressed concern that such a change would lead to higher market volatility and increased operational costs. They argue that extending trading hours would not enhance market efficiency or functionality.
“Our members have been clear expanding trading hours to 24/7 would disrupt current risk management practices, increase operational costs, and create unnecessary exposure,” said NGFA President and CEO Mike Seyfert. “We hope the CFTC will recognize that longer trading hours do not equal stronger markets.”
NGFA emphasized that the current trading structure already serves the needs of market participants effectively. The association urged the CFTC to consider the broader implications of a 24/7 trading model, particularly its potential to negatively impact the stability and usability of agricultural futures markets relied on by producers and traders alike.
The letter is available here.
Photo Credit: national-grain-and-feed-association
Categories: National