Yesterday, the Omaha World-Herald published a New York Times article attributing the recent commodity price retreat to the rise in margin requirements.  Silver margins were $3,500 this time last year.  Today they are $21,000.

We have stated that reducing margins in a bear market has the same impact as raising margins in a bull market.  We are losing confidence in that position as we look at the growing speculative imbalance (crowd mentality?) that hedgers are dealing with in our current market. 

Thanks to the Dodd-Frank Act, the ability to establish margins is now a part of the CFTC's oversight ability.  This new power is apparently what caused CME to retreat to 40¢ corn trading limits yesterday, down from 50¢.

Share Your Thoughts: Corn Volatility

Please take a moment to share you thought's with us on corn futures volatility before we head off to next week's CFTC Advisory Committee session in D.C.  You can call us at 402.884.0066 x111 or email ehicks@cfosystemsllc.com.