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Trading Hours Recently Reduced; Expected To Increase Liquidity

New trading hours in the Chicago Board of Trade (CBOT) and Kansas City Board of Trade (KCBT) are expected to improve liquidity and market performance. Liquidity allows soybean traders to move in and out of markets more freely. And with fewer trading hours, the volume of buyers and sellers will be more highly concentrated.

Beginning April 8, trading hours in the CBOT grain and oilseed and KCBT wheat markets will be reduced from 21 hours to 17½ hours. More than 4,000 farmers, commercial customers, traders and other industry participants who manage risk in these markets weighed in on the change before it was made to determine what best met their needs.

“There were concerns that liquidity and market performance were adversely affected by the longer trading hours,” said Dave Lehman, managing director of commodity research and product development of CME Group, which is the exchange operator that administrates the CBOT and KCBT. “By shortening the hours, we’re helping with some of the business practices of the industry. Trading will be more concentrated, which will make the market more liquid and efficient during the hours that it’s open.”

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