CME Group Revising Position Limits on Agricultural Contracts

CHICAGO, IL – Trade groups and investors are breaking down news last week from the Commodity Futures Trading Commission (CFTC) that it intends to increase both spot-month and all-months-combined speculative position limits effective March 15, 2021.

According to a press release from the CME Group, the change is intended to coincide with the effective date of CFTC’s final rule that revises speculative position limits for corn, wheat, soybeans, and other agricultural commodities, and imposes such limits on some energy, metals and financial futures contracts for the first time. For corn, wheat, and soybean contracts, and subject to CFTC review, though CME proposes to increase spot-month limits from the current 600-contract limit to 1,200 contracts.

In somewhat of a surprise move, Todd Kemp, Senior Vice President, Treasurer with the National Grain and Feed Association says CME proposed to increase all-months-combined limits for corn, wheat, soybeans, and other agricultural commodities to the new maximum federal limits finalized by CFTC. He explains that in some cases, this would result in very large increases from current levels. For example, the all-months-combined limit for corn would increase from 33,000 contracts to 57,800; CBOT wheat would increase from 12,000 contracts to 19,300; soybeans would increase from 15,000 contracts to 27,300. In addition, other commodities like soybean meal and oil also would see very large increases.
(SOURCE: All Ag News)