Comment Text:
Western Grain Marketing is a grain company located in western Illinois. We have country elevators at 13 locations and a rail shuttle that loads corn which we sell to the Texas and southern states region. We use hedging each and every day to manage our position. The proposed rule would dramatically narrow the range of hedging transactions that we make on a routine basis that as of now, qualify as a bona fide hedge. Western Grain Marketing, like thousands of agribusiness firms in the United States rely on these types of hedging transactions to manage our risk on a day to day basis. If the rule that is currently being proposed is put into place, our company as well as other companies like ours would suffer. We have been using this technique of managing our risk for decades and our strategies involved in hedging would no longer be acceptable to the CFTC as they would be listed outside the new proposed definition of a "bona fide hedge". Our company uses techniques such as pre-hedging purchases of grain from our producers outside trading hours at the CBOT/CME. The proposed rule would restrict our use of these strategies which have been accepted and used by the industry for many years and would increase dramatically the costs of hedging for us and others who use hedging to manage risk. To take this a step further, higher costs for companies like ours would lead to lower bids for producer commodities and ultimately high consumer prices. Thank you for your consideration.
