Received CFTC 

Recorda Section 

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7fflB NOV -5 

From: Filip Meijer (filipmeijer@hotmail.com) Ph: 646 662 4611 

OFC., 

To: CFTC, Office of the Secretariat: Sudik, Gabrielle A. 

Re: "Proposed Rules for Trading Off the Centralized Market 

Date: 11/03/2008 

To Whom It May Concern: 

/J 

COMMENT 

The greatest reasons for trading in a Centralized Market are to provide all market participants a 

fair and transparent market. This means that all participants will have to obey by the best bid 

and the best offer in any commodity whether it is options or futures. Block trading, however, 

only involves two market participants. Since a block trade can occur outside of the Centralized 

Market, one of the participants may be taken advantage of since he may not know that there 

could be a better bid or offer in the Centralized Market. This situation has occurred, and that 

makes block trading unfair and non-transparent. The major problem with block trading, and 

especially small size block, is that block trading encourages trading without the use of price 

discovery. Price discovery exists in the centralized market place and that is what makes the 

market fair and transparent. 

On the other hand, I understand that some trades are of such magnitude that the Centralized 

Marketplace may not be able to execute a size trade at one price. Only in a situation described 

above should a block trade occur. A block trade between two participants will only be fair to all 

market participants when the size of the trade is too large for the Centralized Market. 

The question is then: 

How to determine the minimum size of a block trade in order to make it a fair trade? 

After considering several options of averages and percentages of open interest and daily 

volumes etc, I cannot come up with one applicable standard. The only fair possibility as I see it 

is to form a committee for each commodity with representatives from all aspects of the market 

(floor traders, producers, end users, and other traders such as commodity funds.) It is 

impossible to decide on one block trade size for all markets as the markets vary greatly in size, 

open interest, and daily volume. 

What I do know is that the block trade sizes that are in place on the ICE exchange where Coffee, 

Cocoa, Sugar, Cotton, and OJ are traded are too small. Traders on the floor together with off 
.. 

the floor traders and customers could each easily take on the block trade limits that are in place 

today. In today's world with Instant Messaging between brokers and customers, the agriculture 

products on the ICE are extremely efficient and transparent markets. Since block trading was 

introduced, it has only made the markets more illiquid and non-competitive than they were 

before. 

Given recent events in the financial sector, I believe we should do everything possible to make 

markets extremely efficient and transparent. Small quantities of block trading have the 

complete opposite effect. Block trading should only constitute a miniscule fraction of the total 

volume traded. If that is not possible, then due to liquidity, transparency, and noncompetitiveness block trading in the small agricultural markets should be abandoned 

completely. 

I have been a commodity trader for eight years and I am a great proponent of a free and 

competitive market place. I am available for comment or discussion at 

FilipMeijer@hotmail.com or at phone number 646 662 4611. 

Thank You, 

Filip Meijer