Washington, D.C. (July 25, 2012)—The National Council of Farmer Cooperatives (NCFC) today urged the Commodity Futures Trading Commission (CFTC) to take a collaborative approach to help farmer co-ops to comply with the new regulations of hedging activities stemming from implementation of the Dodd-Frank Wall Street Reform Act.
The call came during the testimony of NCFC President Chuck Conner during a House Agriculture Committee hearing to review Dodd-Frank implementation and its impact on hedging activities by farmers, ranchers and agribusiness.
“As we have throughout the process, we urge CFTC to continue to work closely with the agriculture industry and take a collaborative approach to compliance,” Conner said. “We hope CFTC will lend a hand and help us. Not as a regulator looking to make an example out of honest mistakes, misunderstandings or oversights, but rather as a partner to help us meet the various requirements.”
Conner also emphasized the leadership on the issue shown by the Agriculture Committee, and the need for continued vigilance.
“This committee’s oversight of CFTC as they have written the rules regulating the over-the-counter swaps markets has been instrumental in ensuring that co-ops and farmers continue to have access to the necessary risk management tools,” he testified. “This continued oversight is as important as ever as the process turns from one of rulemaking to one of compliance.”
Conner also expressed concern over several rules that have not yet been finalized and that continue to cause uncertainty over new costs that will be imposed on farmers and their co-ops looking to offset risk in the marketplace. Getting these pending rules right, Conner emphasized, is essential to ensuring that farmer cooperatives and their members continue to have access to cost effective hedging options through the OTC market.
NCFC is a national association representing America’s farmer cooperatives. There are nearly 3,000 farmer cooperatives across the U.S. whose members include a majority of our nation’s more than 2 million farmers, ranchers and growers. These farmer cooperative businesses handle, process, and market agricultural commodities and related products; furnish farm supplies; and provide credit and associated financial services. Earnings from these activities are returned to their members on a patronage basis. Farmer cooperatives also provide jobs for nearly 250,000 Americans, many in rural areas, with a combined payroll of over $8 billion.