For Release: April 10, 1997
CFTC SIGNS MOU WITH USDA TO ASSIST IN RISK MANAGEMENT EDUCATION EFFORT
The Commodity Futures Trading Commission (CFTC) has signed a Memorandum of Understanding (MOU) with agencies of the United States Department of Agriculture in which it has agreed to provide assistance to USDA's risk management education efforts. The agreement, which was signed by Chairperson Brooksley Born for the Commission, renews an agreement on educational cooperation first signed by the Commission and USDA's Extension Service in April 1992. The newest MOU, however, has been revised and expanded specifically to include the participation of USDA's Risk Management Agency and to incorporate the provisions of Section 192 of the Federal Agricultural Improvement and Reform (FAIR) Act of 1996. That section of the FAIR Act requires the Secretary of Agriculture, ``in consultation with the Commodity Futures Trading Commission,'' to ``provide such education in management of the financial risks inherent in the production and marketing of agricultural commodities as the Secretary considers appropriate.''
The renewed MOU establishes a Steering Committee that will guide USDA's Risk Management Education Initiative. Initially this Steering Committee will include the Administrator of USDA's Risk Management Agency, Kenneth D. Ackerman, the Administrator of USDA's Cooperative State Research, Education, and Extension Service, Dr. B. H. Robinson, and CFTC Commissioner Joseph B. Dial, Chairman of the Commission's Agricultural Advisory Committee. The Risk Management Education Initiative itself is intended to be broad in both scope and content, focusing on integrating basic information on risk management from all relevant sectors, including crop insurance as well as futures and options. The education effort will be directed toward two audiences: third parties (such as insurance agents and commodity brokers) who deal directly with farmers on a variety of tools to mitigate risks, and the farmers themselves. To initiate the education program, the agencies are planning a Risk Management Education Summit for the week of September 14, 1997, which will establish the basis for a consistent nationwide education effort.