Good afternoon, everyone. Thank you for being here today. I’m excited to reconvene the Agricultural Advisory Committee for the first time in over two years. Welcome to all our new members, and welcome back to our returning members.
Now, before I begin, I must note that the views I share today are my own as Chairman and do not necessarily reflect those of the Commission.
After my confirmation last December, one of my first official acts as Chairman was to revive the Agricultural Advisory Committee. It has been a tradition for the Chairman of the CFTC to sponsor the committee since it was first formed by Chairman Susan Phillips in 1985.
President Ronald Reagan appointed Dr. Phillips to lead the agency—as the first woman to lead any federal financial regulatory agency—at a time when farmers were struggling to recover from a severe drought, exchanges had just begun to list novel commodity options after a long prohibition, and the CFTC and SEC grappled with thorny jurisdictional questions as the once-bright line between commodities and securities began to blur. Does any of that sound familiar?
At Chairman Phillips’ swearing in, President Reagan remarked that “[t]his Commission is one of my favorites because it proves that government can do a good job without soaking up the taxpayers’ money or overregulating the marketplace,” and it “does its job without hindering industry growth and innovation.”
It’s my hope as Chairman to ensure that President Reagan’s words continue to ring true today and for years to come. That’s why we’re hard at work to future-proof the agency’s approach to regulation so that it operates more efficiently than ever before. And, most importantly, to make sure that we are not smothering growers, builders, and entrepreneurs with regulatory red tape.
America’s farmers, ranchers, and producers support manufacturers, transportation networks, local businesses, financial institutions, and countless jobs across rural America. Yet they’re often taken for granted. They are, in many ways, the “forgotten men and women” of our economy. They work long hours, face unpredictable weather, fluctuating commodity prices, and global competition—all while navigating an increasingly complex regulatory environment.
For years, federal agencies have layered regulation upon regulation onto financial intermediaries that service the agricultural industry. And in doing so they’ve often failed to ask the farmers, ranchers, or producers, who depend on these markets, whether the rules work for them.
Many of the futures commission merchants, swap dealers, and commodity trading advisors that farmers, ranchers, and producers rely upon for access to the markets are wholly owned by banks that are subject to onerous capital requirements. And, of course, the futures commission merchants, swap dealers, and commodity trading advisors are separately regulated by the CFTC and National Futures Association.
In the wake of the 2008 financial crisis, the Dodd-Frank Act brought a substantial volume of new rules, definitions, and compliance obligations, creating a complex web of new requirements. By the end of 2016, the CFTC had finalized nearly eighty new regulations under the Act—significantly increasing the cost of participating in the markets.
The number of futures commission merchants shrunk from roughly 90 before 2007 to less than 50 today. Farmers, ranchers, and producers who rely upon commodity derivatives for risk management had to address new hedging rules, position limits, swap data reporting obligations, and the expense of hiring an army of lawyers and compliance personnel to figure it all out. The worst part of the story is that many of these regulations have proven to be unnecessary, duplicative, overly complex, and difficult to enforce.
This is unacceptable. Farmers, ranchers, and producers depend on these markets to hedge risk, manage uncertainty, and plan for the future. Our responsibility is to ensure continued access to fair, efficient, and well-functioning markets. Not to overregulate the marketplace, force innovators to conform with ill-conceived rules, and drive our industries offshore.
On a recent visit to a family farm, I spoke with an owner-operator who described how every new cost, from fuel, fertilizer, or equipment to compliance with regulations, forces him to struggle to make a profit. That’s why he takes advantage of every tool at his disposal to cut costs.
I hear this again and again from farmers and producers across the country, and that’s why meetings like today’s are so important.
If the federal government continues to make it harder to operate a farm or ranch in America, we shouldn’t be surprised if fewer Americans choose to remain in the industry. That would be a mistake our country cannot afford.
We cannot accept a future where America is dependent upon foreign countries—and potentially adversaries—for the food and agricultural products we rely on. We must support our domestic producers, providing them with sound markets and opportunities to hedge their risks.
That’s why we’ve ended the prior administration’s one-size-fits-all approach to financial regulation. Our goal will not be to regulate farmers out of our markets or overwhelm producers and the financial institutions that serve them with outdated or unnecessary requirements. Instead, we are pursuing a deregulatory agenda focused on identifying rules that no longer serve their intended purpose and eliminating the roadblocks and red tape that have reduced productivity.
That includes reviewing existing regulations where policies unnecessarily burden market participants and working with the prudential regulators to make sure that bank capital requirements don’t inadvertently result in less intermediaries willing to service the agricultural industry.
It also includes promoting greater transparency in the commodity markets to facilitate fair competition. To start, I’ve directed the staff to begin circulating the Commitments of Traders Report on a bi-weekly basis, as opposed to the current once-weekly format. We hope to begin doing so by the end of the year.
We’ve also ended the prior administration’s campaign of regulation by enforcement. Strong enforcement remains essential to maintaining confidence in our markets, but our emphasis is on pursuing fraud, manipulation, and abuse—not punishing honest market participants for technical or minor compliance missteps that create little risk to market integrity.
Our objective is to protect markets while allowing businesses to innovate, compete, and grow. This effort requires strong coordination across government. That’s why the CFTC is working closely with the U.S. Department of Agriculture to finalize a memorandum of understanding that will improve interagency coordination and provide producers with greater access to risk management tools.
Today’s meeting of the Agricultural Advisory Committee is an important part of our effort to ensure that our regulations are designed for the growers, builders, and entrepreneurs who use our markets; rather than academics sitting in an ivory tower. We want to hear directly from the people who know the agricultural industry best. Your experience helps us identify where regulations are working, where they are creating unintended consequences, and where reforms can make it easier to do business while preserving strong and resilient markets.
This collaborative approach reflects the broader priorities of the Trump Administration, which has made supporting American agriculture and reducing unnecessary burdens on Main Street a central focus.
We share the belief that government works best when it enables economic growth instead of standing in its way. When we allow the invisible hand rather than the government’s hand to guide our markets, the benefits extend far beyond agriculture.
As we begin today’s discussion, I encourage everyone to speak candidly. Your feedback will help the Commission facilitate a regulatory approach that protects market integrity while ensuring America’s farmers, ranchers, and producers can continue doing what they do best: feeding, fueling, and clothing our nation.
Now, to kick things off, I’m pleased to introduce Senator Tuberville of Alabama, who I have enjoyed working with and getting to know over the past several months. He has served in the Senate since 2021 and is an essential member of the Senate Agriculture Committee, which is the CFTC’s committee of jurisdiction. Coach also hosts his own Agriculture Advisory Committee focused on supporting Alabama farmers and producers. Coach Tuberville, thanks for being here with us today.
