8951..01 

COMMODITY FUTURES TRADING COMMISSION 

17 CFR Part 150 

RIN 3038--AC140 

Revision of Federal Speculative Position Limits 

AGENCY: Commodity Futures Trading Commission 

ACTION: Proposed rules; withdrawal. 

SUMMARY: On November 21, 2007, the Commodity Futures Trading Commission 

(Commission or CFTC) published a proposed rulemaking to increase the Federal speculative 

position limits for certain agricultural commodity contracts set out in Commission regulation 

150.2 (proposed rulemaking). 1 The proposed rulemaking would have increased the single-month 

and all-months-combined positionlimits for all contracts except contracts based on oats in 

accordance with the formula set out in Commission regulation 150.5( c). The proposed 

rulemaking would have also required the aggregation of traders' positions in contracts that share 

substantially identical terms with regulation 150.2-enumerated contracts, regardless of whether 

such contracts were specifically delineated in that regulation, for the purposes of ascertaining 

compliance with the Federal speculative position limits. For the reasons provided below, the 

Commission has determined to withdraw the proposed rulemaking. 

FOR FURTHER INFORMATION CONTACT: Donald Heitman, Senior Special Counsel, 

Division of Market Oversight, Commodity Futures Trading Commission, Three Lafayette Centre, 

1 Revision ofFederal Speculative Position Limits, 72 FR 65483 (November 21, 2007). 
1155 21st Street, NW, Washington, DC 20581, telephone (202) 418-5041, facsimile number 

(202) 418-5507, email dheitman@cftc.gov; or Martin Murray, Economist, Division of Market 

Oversight, telephone (202) 418-5276, facsimile number (202) 418-5507, email 

mmurray@cftc.gov. 

SUPPLEMENTARY INFORMATION: The Commission has long established and enforced 

speculative position limits for futures contracts on various agricultural commodities. The 

Commission periodically reviews these Federal speculative position limits, which are set out in 

Commission regulation 150.2? On November 21, 2007, the Commission published its proposed 

rulemaking to increase Federal speculative position limits for all single-month and all-monthscombined positions in all commodity markets enumerated in Commission regulation 150.2, 

except Chicago Board of Trade (CBT) Oats, based on the formula set out in Commission 

regulation 150.5(c). The rulemaking proposed to increase levels for single-month and allmonths-combined positions for CBT Com, Soybeans, Wheat, Soybean Oil, and Soybean Meal; 

Minneapolis Grain Exchange Hard Red Spring Wheat; Kansas City Board of Trade Hard Winter 

Wheat; and New York Board ofTrade3 Cotton No. 2. In addition, the rulemaking proposed to 

require the aggregation of positions in contracts that share substantially identical terms with 

regulation 150.2-enumerated contracts, regardless ofwhether such contracts were specifically 

delineated in that regulation, for the purposes of ascertaining traders' compliance with the 

Federal speculative position limits. 

2 Commission regulation 150.2 imposes three types of position limits for each specified contract: 

a spot month limit, a single-month limit, and an all-months-combined limit. The Commission 

most recently adopted amendments to levels for Federal speculative position limits in 2005. See 

70 FR 24705 (May 11, 2005); 

3 The New York Board of Trade was acquired by ICE Futures U.S. in January, 2007. 

2 
The Commission requested public comment by December 21, 2007. On December 31, 

2007, the Commission extended the initial comment period to January 21, 2008 to give interested 

parties additional opportunity to comment.4 The Commission received a total of 40 comment 

letters in response to its Federal Register publication. 5 Six letters generally favored the proposed 

regulations and 34letters were generally opposed to their adoption. An Agricultural Forum held 

by the Commission on April 22, 2008 served as an additional venue for the presentation of views 

with respect to the proposed rulemaking and a related Commission proposal to adopt a risk 

management exemption from the Federal speculative position limits. 6 

Collectively, the comments received in response to the proposed rulemaking and at the 

Commission's April22 Agricultural Forum reflected differing perspectives on a wide range of 

issues of substantive import to the proposed rulemaking. The issues covered by the commenters, 

both in favor and opposed to the Commission's proposal to revise the Federal speculative 

position limits, included product margin requirements, the convergence of cash and futures 

transaction prices, the impact of commodity-linked instruments traded on national securities 

exchanges on CFTC regulated transactions, the degree of transparency for market participation, 

and the quantification of the impact of speculative trading on market volatility. In light of the 

wide range of divergent positions that have been put forth by interested parties, the current 

market conditions for the contracts that would be affected by the proposed rulemaking, and in 

order to determine whether further consensus among the affected parties should be sought, the 

4 72 FR 74213 (December 31, 2007). 

5 Federal Register Comment File 07-014, available at 

www .cftc.gov/lawandregulation/federalregister/federalregistercomments/2007 /07 -014.html. 

6 Risk Management Exemption from Federal Speculative Position Limits, 72 FR 66097 

(November 27, 2007) (to be withdrawn). 

3 
Commission has determined to withdraw the proposed rulemaking pending further consideration 

of the relevant issues. 

Issued by the Commission this June 2, 2008, in Washington, DC. 

David 

~aStawick ~ 

Secretary of the Commission 

4