Regulators at odds over longer CME grain cycle

Jill Sommers, a commissioner at the Commodity Futures Trading Commission, on Monday said she opposed a push by fellow Commissioner Bart Chilton to delay the start of nearly around-the-clock grain trading by the CME Group with a 30-day comment period.
In a Reuters interview, Sommers said the CFTC should not institute a 30-day comment period on CME's plan for 22-hour trading in grain futures and options because other markets already trade similar extended hours. "There are many other contracts that trade with those types of hours," said Sommers, who is one of five CFTC commissioners.
CME had to give the CFTC 10 business days' notice before implementing the change. CFTC staff is evaluating the exchange operator's plan and will likely decide whether to implement an extended comment period before Wednesday, when the 10-day wait ends.
CME is slated to increase trading hours on May 21. The planned shift to 22-hour trading at the CME's Chicago Board of Trade, which dominates agricultural markets, has become a contentious issue among grain traders because it will keep markets open during key US Department of Agriculture crop reports that often cause sharp swings in prices.
Top US grain groups have called on the CFTC to institute a 30-day comment period on CME's plan so that grain elevator managers, merchandisers and exporters have more time to evaluate the plan and prepare for longer hours. CME should be allowed to implement the longer grain cycle once the 10-day period is finished because the increase is not a "novel or complex" change for the markets, which is the standard that triggers an extended review by the CFTC, Sommers said.
CME said in a statement that it was working with its customers "to help them prepare for the transition." Chilton said on Friday the CFTC should institute a 30-day comment period to allow for feedback from members of the grain industry. The difference of opinion between Sommers and Chilton came to light as Atlanta-based IntercontinentalExchange launched new, electronically traded grain and soy contracts on a 22-hour basis in the biggest challenge yet to CME's iron grip on the markets.