By Sarah Gonzalez, Director of Communications and Digital Media
The Commodity Futures Trading Commission (CFTC) should take an active role in assessing and addressing the risks of climate change, CFTC Commissioner Rostin (Russ) Behnam said this week.
“Failing to address financial market risks associated with climate change will impede economic growth, and most likely hit rural communities the hardest,” Behnam said in a speech at CFTC’s Market Risk Advisory Committee meeting on June 12. Behnam said the committee should identify market risks and recommend “data-driven policy solutions” to mitigate climate risk.
Behnam cited extreme weather events across the Midwest, including record rainfall and flooding that have prevented planting of corn and soybeans. He noted that worldwide economic costs from natural disasters in 2018 totaled $160 billion.
“The human element of these tragedies is real and heart wrenching. But the economic element is also just as real,” he said. “Risk exposures to insurance providers, asset managers, pension funds, commercial and retail banks – all users of derivatives markets – to price and shift risk, cannot be understated. But ultimately, the final risk often weighs on farmers, investors, customers, consumers and homeowners.”