Chicago Mercantile Exchange Adjusts Daily Price Limits For December Live Cattle Contracts

For the second time in the past week, Chicago Mercantile Exchange Inc. has announced adjustments in its daily price limits in its December live cattle futures contracts in response to market activity following the U.S. Department of Agriculture's announcement of the discovery of Bovine Spongiform Encephalopathy ("Mad Cow Disease") in one Holstein dairy cow in Washington. Holstein cattle are not deliverable on CME's cattle contracts.

For the trading session on Tuesday, Dec. 30, 2003 only, if the December 2003 live cattle contract becomes limit bid or limit offered, then after a one-hour period during which the market shall continue to be open for trading at the $0.05 limit, the daily price limit for the December 2003 contract only shall be expanded by $0.025 per pound to a total daily limit of $0.075 per pound for the remainder of the trading day. On Wednesday, December 31 the daily price limit for the December 2003 only shall be $0.050 per pound.

For all other contract months in live cattle futures and for all contract months in feeder cattle futures, the emergency price limit schedule announced on December 26 will continue to be in place. The daily price limit on Tuesday, December 30 will be $0.05 per pound. If either of the two nearby contract months is locked limit at the close of trading on Tuesday, December 30, the limit on Wednesday December 31 will continue to be $0.05 per pound. Otherwise it will revert to $0.03 per pound.

Thereafter daily price limits will adhere to the schedule as revised on October 15, 2003. That schedule is as follows:

If either of the two contracts in the even month cycle nearest to expiration settles on the limit bid for two successive days or on the limit offer for two successive days, the price limit shall be raised to $0.03 per pound for all contract months.
If the daily price limit is $0.03 and either of the two contracts in the even month cycle nearest to expiration settles on the limit bid for two successive days or on the limit offer for two successive days, then the price limit shall be raised to $0.05 per pound for all contract months.
If the daily price limit is $0.05 and neither of the two contracts in the even month cycle nearest to expiration settles on the limit bid or limit offer, without regard to market direction, then the daily price limit for all contract months shall revert to $0.03 on the next business day.
If the daily price limit is $0.03 and neither of the two contracts in the even month cycle nearest to expiration settles on the limit bid or limit offer, without regard to market direction, then the daily price limit for all contract months shall revert to $0.015 on the next business day.

Chicago Mercantile Exchange Inc. (www.cme.com) is the largest futures exchange in the United States. As an international marketplace, CME brings together buyers and sellers on its trading floors and GLOBEX® electronic trading platform. CME offers futures and options on futures primarily in four product areas: interest rates, stock indexes, foreign exchange and commodities. The exchange moved about $1.4 billion per day in settlement payments in the first 11 months of 2003 and managed $34.1 billion in collateral deposits at Nov. 30, 2003. CME is a wholly owned subsidiary of Chicago Mercantile Exchange Holdings Inc. (NYSE: CME), which is part of the Russell 1000® Index.

Chicago Mercantile Exchange, CME and GLOBEX are registered trademarks of Chicago Mercantile Exchange Inc. Further information about CME and its products is available on the CME Web site at www.cme.com.