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Cattlemen Seek Expansion of Daily Price Limits

PHOENIX (January 30) - Seeking to provide stability to the live cattle and feeder cattle futures market, members of the National Cattlemen’s Beef Association’s (NCBA) Live Cattle Marketing Committee voted to seek an expansion of the daily limits in those contracts.Committee members will forward a resolution to the NCBA Board of Directors that asks the association to support an increase in the daily price limit from $1.50 to $2.

The Committee took this action in response to a pending request from the Chicago Mercantile Exchange to the Commodity Futures Trading Commission to expand the daily limit to $3.Committee members feel the $2 limit is a reasonable compromise to the proposal from the Chicago Mercantile Exchange.

The Commodity Futures Trading Committee will make the final determination on any contract changes.

Furthermore, the resolution calls for the daily limit in the contract to expand to $3 after two limit closes in the same direction on two consecutive days.The daily limit would remain at $3 until there isn’t a daily limit trading day, at which point the limit again would revert to $2.
The NCBA Board will vote on the resolution Saturday.

The Committee also supported a proposal to reclassify the Animal ID Subcommittee as a commission, and charge it with five responsibilities.

--establish guidelines to help producers to comply with any mandatory ID program
-- establish standards for and identify an audit process for ID goods and services that companies with to present to NCBA for a “Beef USA” seal of approval
-study the need and usefulness of a USDA process-verified or ISO approved producer certification
-provide counsel for a producer education program for ID
-other duties as assigned by NCBA policy committeesCommittee members also voiced their support for continuing USDA mandatory price reporting.The law is set to sunset this year unless renewed.
 
 

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