Risk Management

By Sarah Gonzalez, Director of Communications and Digital Media Climate change could pose systemic risks to the U.S. financial system, according a report published by a Commodity Futures Trading Commission (CFTC) advisory panel on Sept. 9. “The central message of this report is that U.S. financial regulators must recognize that climate change poses serious emerging risks to the U.S. financial system, and they should move urgently and decisively to measure, understand and address these risks,” noted the report, dubbed Managing Climate Risk in the U.S. Financial System. The report, ... Read More

President Trump this week nominated a Housing and Urban Development Department (HUD) senior adviser to serve as a member of the Commodity Futures Trading Commission (CFTC). If confirmed by the Senate, Robert B. Bowes, a Republican, would succeed current Republican commissioner Brian Quintenz, whose term technically expired in April, but who is allowed under law to continue to serve until the end of the year.  It widely is anticipated that Quintenz, who was confirmed and sworn into office at the CFTC in August 2017, will leave the agency in late October. The White House announcement ... Read More

By Todd Kemp, Senior Vice President, Treasurer The NGFA on July 13 submitted an official statement to the Commodity Futures Trading Commission (CFTC) responding to its proposal that would update the agency’s rules governing bankruptcy proceedings involving futures commission merchants (FCMs) and designated clearing organizations (DCOs).  The CFTC proposal would be the first update of its bankruptcy regulations since 1983 and would modernize policies and procedures and strengthen existing CFTC practices that have been employed in previous insolvencies. The proposal was of ... Read More

By Todd Kemp, Senior Vice President and Treasurer Following consultation with the NGFA’s Risk Management Committee and other customers, the CME Group in 2019 updated its rule that governs delivery procedures – and, more specifically, barge load-out procedures at elevators regular for delivery – during anticipated closures of the Illinois River waterway for lock-and-dam repairs scheduled this summer. Provisions of the rule will take effect if repairs result in a majority of regular shipping stations being obstructed for 15 days.  CME has stressed that the rule is designed to have ... Read More

As reported in last week’s NGFA Newsletter, the association on May 15 submitted a formal statement to the Commodity Futures Trading Commission (CFTC) on the agency’s proposed rule implementing speculative position limits. The NGFA statement  was filed too late that day to include a link in the newsletter; it can be accessed here. See the May 15 article for a more detailed description of the contents of the NGFA statement. The CFTC now will analyze numerous comments submitted by the public and incorporate changes before proceeding to a vote on a final rule. It is ... Read More

By Todd Kemp, Senior Vice President and Treasurer The NGFA on May 15 will submit an official statement to the Commodity Futures Trading Commission (CFTC) responding to its request for comments on the agency’s latest attempt to implement speculative position limits across a range of commodities and futures contracts.  The commission has attempted several times previously – during the almost 10 years since the Dodd-Frank financial reform legislation became law – to finalize rules for position limits, but each effort has fallen short. Of course, the futures contracts for the ... Read More

By Todd Kemp, Senior Vice President, Treasurer In lieu of a physical meeting given the ongoing coronavirus pandemic, the Commodity Futures Trading Commission (CFTC) convened a conference call and webcast of its Agricultural Advisory Committee (AAC) on April 22. CFTC Chairman Heath Tarbert sponsors the AAC and was joined by Secretary of Agriculture Sonny Perdue to comment on the U.S. Department of Agriculture’s (USDA) responses to the current marketplace situation. Perdue reviewed the recently announced support package for agriculture, and Tarbert assured participants that the CFTC ... Read More

By Todd Kemp, Senior Vice President, Treasurer As reported in last week’s NGFA Newsletter, the Commodity Futures Trading Commission (CFTC) on Jan. 30 voted to publish a new proposal designed to implement one of the final remaining pieces of Dodd-Frank legislation that was signed into law 10 years ago. NGFA’s initial staff analysis of the proposal finds much to support. The proposal would implement speculative position limits on a range of commodities on which such limits have not been imposed previously. For grain and oilseed futures contracts, which have had position limits for ... Read More

The Commodity Futures Trading Commission (CFTC) voted 3-2 on Jan. 30 to publish for public comment its latest position limits proposal – the agency’s fourth such attempt since the Dodd-Frank Act was enacted in 2010. CFTC Chairman Heath Tarbert emphasized in a statement issued after the vote that the proposal will protect agricultural markets from excessive speculation, but “just as importantly,” will ensure fair access. The proposal would cap speculative positions in the covered derivatives contracts to help prevent “cornering and squeezing,” Tarbert said. The proposal also would end the ... Read More