How US shutdown will affect US commodities markets


Posted at Jan 22 2018 04:04 PM

The U.S. Capitol is lit during the second day of a shutdown of the federal government in Washington, US, January 21, 2018. Joshua Roberts, Reuters

Commodities markets should trade normally on Monday even though key regulators, including the Commodity Futures Trading Commission (CFTC), will be operating with skeleton crews due to the US government shutdown.

During shutdowns, non-essential government employees are furloughed, or placed on temporary unpaid leave. Workers deemed essential, including those dealing with public safety and national security, keep working.

Private exchange operators are generally not affected, but weekly economic reports from the US Energy Department and US Department of Agriculture (USDA), key for traders, have in the past been delayed until the government re-opens.

FINANCIAL OVERSIGHT: The Commodity Futures Trading Commission (CFTC) said it would have to furlough 95 percent of employees immediately. An agency spokeswoman said the derivatives regulator could, however, call in additional staff in the event of a financial market emergency.

The 2013 shutdown caused weekly figures on positions in options and futures to be delayed until after the government reopened.

ENERGY: The US Energy Information Administration (EIA) did not respond to a request for comment from Reuters. In 2013, the EIA did not send out weekly reports on US inventories, as well as other reports, during the furloughs. Respondents to the department's surveys were told they could continue to submit data - but no one will be able to answer technical questions. A notice on the Energy Department's website says that the only functions that will continue are those related to public safety or the protection of property.

AGRICULTURE: The USDA said that the shutdown may cause a lapse in the preparation and release of the monthly World Agriculture Supply and Demand Estimates report, though the next release is not until Feb. 8.

Updates to the USDA website will cease, the department said in a notice on its website, so USDA reports will not be provided.