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CBOT Battles Traders Over New Grain Price Settings

27 June 2012

US - CME Group battled with traders in court yesterday (26 June) over new rulings to settle end-of-day grain prices.

More than 20 pit traders at the Chicago Board of Trade (CBOT) are suing the exchange, in a bid to deter a new way of calculating grain prices.

This is the latest example of friction being caused by the rise of electronic futures dealing.

On Friday (22 June) traders attempted to have the decision to incorporate electronic activity into settlement prices reversed, fearing that the change would shift volume away from pits.

Settlement rules became effective on Monday (25 June).

Lawyers are arguing that the CME ignored traders' contractual rights, as the exchange was aware that the new settlement rules would eliminate demand for the traditional open-outcry system.

TheCropSite News Desk

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