Demise of the Pork-Belly Contract

Discussion in 'Wall St. News' started by ChkitOut, Dec 27, 2010.

  1. Pork Bellies Now 'Nontrading Places'

    Activity Grinds to a Near-Halt at Chicago Merc; 'There's Nobody Down There'

    It may be a bull market for some commodities, but the pork belly is in danger of going belly-up.

    The iconic futures contract, a staple at CME Group's Chicago Mercantile Exchange since 1961, has seen its volume drop in recent years, prompting calls for the exchange to shut down trading altogether. Now exchange officials and the pork industry are trying to figure out a way to save the contract from extinction.

    But just six contracts changed hands in the month of November
  2. There were 2 brokers in the pit clearing all the orders back in 1996, so IMO, that market was Belly up back then. I was told the Belly contract wasn't ever a viable hedge because of the crooks in the delivery system.

    FWIW, Chic wheat is probably about the same.
  3. only meat packers use it to hedge and these meat packers own the pig farms and pig slaughter house now. there is no tomato futures. etc.

  4. 1) The contract could be listed electronically only and the pit can be phased out if it hasn't been already. :(
    2) There seems to be no open interest beyond March-2011. That expiration may be the final, final, closing bell for the contract. :eek: :mad:
  5. JPope


    ADM withdrew the bellies from it's tradable products, at least for its IB's like nine months ago due to "unpleasant trading experiences by customers" among other reasons.