June 9, 1999

The National Grain and Feed Association has urged Congress to more narrowly define the regulatory functions of the Commodity Futures Trading Commission. CFTC should be more supervisory and assume an oversight role with more precise terms of futures and options contracts left to other self-regulatory entities.

NGFA supports reauthorizing CFTC for another four to five years but also "conceptually" agrees that the agency should defer to other self-regulatory bodies the authority to develop the precise terms of futures and options contracts, trading rules and other matters.

Government "should continue to offer protection against market manipulation and fraud," said NGFA President Kendell W. Keith at a hearing of the risk management subcommittee of the House Agriculture Committee. But CFTC "should be less involved in day-to-day regulation and should not be writing contract market rules. A futures exchange...should have a right to determine what forms of futures and options markets are most desired by hedgers and speculators and make business strategy choices to serve customers."