Font Size: AAA // Print // Bookmark

e8-12728

  • FR Doc E8-12728[Federal Register: June 6, 2008 (Volume 73, Number 110)]

    [Proposed Rules]

    [Page 32260-32261]

    From the Federal Register Online via GPO Access [wais.access.gpo.gov]

    [DOCID:fr06jn08-21]

    =======================================================================

    -----------------------------------------------------------------------

    COMMODITY FUTURES TRADING COMMISSION

    17 CFR Part 150

    RIN 3038-AC140

    Revision of Federal Speculative Position Limits

    AGENCY: Commodity Futures Trading Commission.

    ACTION: Proposed rules; withdrawal.

    -----------------------------------------------------------------------

    SUMMARY: On November 21, 2007, the Commodity Futures Trading Commission

    (Commission or CFTC) published a proposed rulemaking to increase the

    Federal speculative position limits for certain agricultural commodity

    contracts set out in Commission regulation 150.2 (proposed

    rulemaking).\1\ The proposed rulemaking would have increased the

    single-month and all-months-combined position limits for all contracts

    except contracts based on oats in accordance with the formula set out

    in Commission regulation 150.5(c). The proposed rulemaking would have

    also required the aggregation of traders' positions in contracts that

    share substantially identical terms with regulation 150.2-enumerated

    contracts, regardless of whether such contracts were specifically

    delineated in that regulation, for the purposes of ascertaining

    compliance with the Federal speculative position limits. For the

    reasons provided below, the Commission has determined to withdraw the

    proposed rulemaking.

    ---------------------------------------------------------------------------

    \1\ Revision of Federal Speculative Position Limits, 72 FR 65483

    (November 21, 2007).

    FOR FURTHER INFORMATION CONTACT: Donald Heitman, Senior Special

    Counsel, Division of Market Oversight, Commodity Futures Trading

    Commission, Three Lafayette Centre, 1155 21st Street, NW., Washington,

    DC 20581, telephone (202) 418-5041, facsimile number (202) 418-5507, e-

    mail dheitman@cftc.gov; or Martin Murray, Economist, Division of Market

    Oversight, telephone (202) 418-5276,

    [[Page 32261]]

    ---------------------------------------------------------------------------

    facsimile number (202) 418-5507, e-mail mmurray@cftc.gov.

    SUPPLEMENTARY INFORMATION: The Commission has long established and

    enforced speculative position limits for futures contracts on various

    agricultural commodities. The Commission periodically reviews these

    Federal speculative position limits, which are set out in Commission

    regulation 150.2.\2\ On November 21, 2007, the Commission published its

    proposed rulemaking to increase Federal speculative position limits for

    all single-month and all-months-combined positions in all commodity

    markets enumerated in Commission regulation 150.2, except Chicago Board

    of Trade (CBT) Oats, based on the formula set out in Commission

    regulation 150.5(c). The rulemaking proposed to increase levels for

    single-month and all-months-combined positions for CBT Corn, Soybeans,

    Wheat, Soybean Oil, and Soybean Meal; Minneapolis Grain Exchange Hard

    Red Spring Wheat; Kansas City Board of Trade Hard Winter Wheat; and New

    York Board of Trade \3\ Cotton No. 2. In addition, the rulemaking

    proposed to require the aggregation of positions in contracts that

    share substantially identical terms with regulation 150.2-enumerated

    contracts, regardless of whether such contracts were specifically

    delineated in that regulation, for the purposes of ascertaining

    traders' compliance with the Federal speculative position limits.

    ---------------------------------------------------------------------------

    \2\ Commission regulation 150.2 imposes three types of position

    limits for each specified contract: a spot month limit, a single-

    month limit, and an all-months-combined limit. The Commission most

    recently adopted amendments to levels for Federal speculative

    position limits in 2005. See 70 FR 24705 (May 11, 2005).

    \3\ The New York Board of Trade was acquired by ICE Futures U.S.

    in January, 2007.

    ---------------------------------------------------------------------------

    The Commission requested public comment by December 21, 2007. On

    December 31, 2007, the Commission extended the initial comment period

    to January 21, 2008 to give interested parties additional opportunity

    to comment.\4\ The Commission received a total of 40 comment letters in

    response to its Federal Register publication.\5\ Six letters generally

    favored the proposed regulations and 34 letters were generally opposed

    to their adoption. An Agricultural Forum held by the Commission on

    April 22, 2008 served as an additional venue for the presentation of

    views with respect to the proposed rulemaking and a related Commission

    proposal to adopt a risk management exemption from the Federal

    speculative position limits.\6\

    ---------------------------------------------------------------------------

    \4\ 72 FR 74213 (December 31, 2007).

    \5\ Federal Register Comment File 07-014, available at http://

    www.cftc.gov/lawandregulation/federalregister/

    federalregistercomments/2007/07-014.html.

    \6\ Risk Management Exemption from Federal Speculative Position

    Limits, 72 FR 66097 (November 27, 2007) (to be withdrawn).

    ---------------------------------------------------------------------------

    Collectively, the comments received in response to the proposed

    rulemaking and at the Commission's April 22 Agricultural Forum

    reflected differing perspectives on a wide range of issues of

    substantive import to the proposed rulemaking. The issues covered by

    the commenters, both in favor and opposed to the Commission's proposal

    to revise the Federal speculative position limits, included product

    margin requirements, the convergence of cash and futures transaction

    prices, the impact of commodity-linked instruments traded on national

    securities exchanges on CFTC regulated transactions, the degree of

    transparency for market participation, and the quantification of the

    impact of speculative trading on market volatility. In light of the

    wide range of divergent positions that have been put forth by

    interested parties, the current market conditions for the contracts

    that would be affected by the proposed rulemaking, and in order to

    determine whether further consensus among the affected parties should

    be sought, the Commission has determined to withdraw the proposed

    rulemaking pending further consideration of the relevant issues.

    Issued by the Commission this June 2, 2008, in Washington, DC.

    David Stawick,

    Secretary of the Commission.

    [FR Doc. E8-12728 Filed 6-5-08; 8:45 am]

    BILLING CODE 6351-01-P

    Last Updated: June 6, 2008



See Also:

OpenGov Logo

CFTC's Commitment to Open Government

Gavel and Book

Follow the Status of Enforcement Actions