On April 17, 2013, the CME Group reduced grain and oilseed trading hours from 21 hours to 17-1/2 hours per day. This schedule cut afternoon hours and created a 45-minute pause in trading during the morning before open-outcry trading begins.
This change back to the 1:15pm close was reportedly instituted by the exchange in response to complaints the longer hours were reducing liquidity and increasing operating costs.
The NIBA took no official position in January in advance of the change as it was being contemplated because we did not receive any comment or opinions from NIBA members. Board members’ opinions were almost evenly split.
Since the change of trading hours took effect, NIBA has received emails from members. Again, the opinions are evenly split. Some brokers like the return to the traditional close with comments like “less hours to cover” and “we have plenty of time to get our business done.” Others would like a return to longer hours. Some comments on that side are “our customers like the 21-hour trading day” and “business flourished in those extra 45 minutes...we estimate that as much as 15 to 25% of our business was generated between 1:15 to 2pm.”
The reality of a truly global marketplace may inevitably cause extended hours to return. Meanwhile, the CME Group has indicated it is trying to strike a balance to satisfy all its customers - brokers included.
So, here’s your chance - what do you say?
The next NIBA newsletter will report the results, and they will be submitted to the CME Group.