CME warns shutdown could affect livestock, dairy products

To Our Customers:

As you're aware, last night Congress was unable to agree on a spending bill, which resulted in the shutdown of many U.S. government services and the furloughing of government employees today. As a valued customer, we wanted you to be aware this is an issue we continue to closely monitor, as it's possible that a prolonged shutdown of the federal government could have an impact on the settlement procedures of certain dairy and livestock products at CME Group.

A prolonged shutdown of the federal government and furloughing of USDA staff could result in interruptions or gaps in reporting key agricultural pricing information from the USDA's Agricultural Marketing Service (AMS). As a result, we wanted you to be aware that settlement prices for certain CME dairy and livestock contracts, which are cash settled based on USDA data, could be impacted in the event of a prolonged shutdown of the agency and may require the exchange to modify the current settlement procedures of the following products.

Here is a list of CME dairy and livestock contracts that may be impacted:

  • Dairy - September 2013 Class III Milk, Class IV Milk, Butter, Whey, Cheese and Non-Fat Dry Milk futures and options
  • Livestock - October 2013 Lean Hogs, Live Cattle and Feeder Cattle futures and options

We continue to closely monitor this situation and will keep you apprised of any potential changes to the settlement procedures for CME dairy and livestock contracts. Current procedures for the settlement of CME dairy and livestock futures can be found in our CME Rulebook - http://www.cmegroup.com/rulebook/CME/.

All customer inquiries may be directed to David Lehman, Managing Director, Commodity Research and Product Development at 312.930.1875, david.lehman@cmegroup.com; Jack Cook, Director, Commodity Research & Product Development at 312.930.3295, jack.cook@cmegroup.com; or Tom Clark, Director, Commodity Products, at 312.930.4595, thomas.clark@cmegroup.com. Media inquiries should be directed to Chris Grams at 312.930.3435, chris.grams@cmegroup.com.

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