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The New York cotton futures contract:Are changes needed?
Story Date: 6/8/2012
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Source: INTERNATIONAL COTTON ADVISORY COMMITTEE, 6/7/12
The ICAC Secretariat conducted a seminar in its office on June 6, 2012 featuring a presentation by Mr. Joe
O’Neill. Mr. O’Neill is currently the Chairman of the Cotton Committee, Intercontinental Exchange
(ICE), and he was formerly the President of the New York Cotton Exchange, and Senior Vice
President of the New York Board of Trade.
During his presentation, Mr. O’Neill traced the recent history of changes in characteristics of traders
using commodity futures in the United States, the impacts of the shift from floor trading to electronic
trading, and the reasons for differences in cotton contract performance during the most recent five
years compared with decades earlier. He noted that today, commercial traders still are very active
participants in the market, but that the individual speculators have been replaced by hedge funds,
SWAP traders and high frequency traders. He also noted that prior to March 2008, floor traders
were sources of market intelligence that can no longer be recovered through electronic trading.
Mr. O’Neill mentioned some of the factors that could affect trading in a world cotton futures contract
if such a contract were created.
Mr. O’Neill’s PowerPoint presentation can be found on the web at:
http://icac.org/wp-content/uploads/2012/06/oneill_2012_june_icac_seminar.pdf
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