Comment Text:
We appreciate that the CME is addressing the issue of poor contract performance in corn and soybeans. The proposal to increase storage charges is a step In the right direction. It is unfortunate for our industry that there has been nearly two years of disconnect between cash and futures before change can be addressed. Furthermore, the implementation of the changes are another crop year out and then it may take all of another year before the market adjustments may result in convergence. All total, the time for potential cash/futures convergence in the case of beans may take over four years. This is too long and has shaken the confidence for my business, a cooperative with grain warehousing assets. It has hurt our farmer/producers in multiple ways. Both as owners of the cooperative and as producers that rely on efficient cash market performance for their hedging and crop insurance. For this reason, I encourage the CME to go further and make additional changes to the their proposal by including a modified or seasonal VSR. These dynamics will expedite spread dynamics to adjust to future unforeseen market interruptions like the tariff issues we are dealing with in soybeans at the moment. The NFGA risk committee has discussed a seasonal VSR with an annual observation. This concept would be provide for those dynamics.
