CHICAGO - The CME Group, which serves as a global marketplace for a wide range of derivatives, including agricultural commodities, announced on Feb. 10 plans to enhance its livestock market trading, according to a press release

CME plans to reduce livestock trading hours so the trading periods can fit with the greatest liquidity in the markets. The reduction is in response to requests from customer.  

CME Group is responding to concerns in the cattle industry about price volatility in the cattle futures market.

“Nothing is more important to us than the integrity of our markets, which help farmers and ranchers to discover prices and transfer risk,” said Tim Andriesen, CME Group Managing Director of Agricultural Products. “We believe these actions will further enhance our cattle markets for all participants.”

Pending CFTC approval, the first change will start Feb. 29 for trading of live cattle, feeder cattle and lean hog futures. Monday through Friday CME Globex futures and options will be traded from 8:30 a.m. to 1:05 p.m. CDT. Trading for open outcry options will be held from 8:30 a.m. to 1:02 p.m. CDT.

CME Group will also conduct a public review with cattle customers to study if a discount is necessary at designated delivery points for live cattle futures.  This review will take place during February with planned changes announced in Q1 of 2016.

Finally, CME Group and the National Cattlemen’s Beef Association will join forces to form a working group and other enhancements to the cattle markets. This could include circuit breakers and other measures to enhance the quality of the market. 

CME Group recently addressed livestock contracts concerns and made moves in response to concerns in the cattle industry about price volatility in the cattle futures market.