BROKERAGE ABN AMRO will close its pit trading grains desk on the floor of the Chicago Board of Trade on 1 November, the team’s five members said yesterday, in one of the clearest signs that the iconic “open outcry” style of trading is drawing to a close.
The exchange, the citadel of the global grains trade, has seen business shift from the trading pits where raucous traders in multi-colored jackets execute trades with hand signals to what is considered the more efficient electronic platform.
The five-person ABN AMRO team, consisting of four phone clerks and one runner, was once the mainstay of the 164-year-old exchange, but its fortunes began to fade with the arrival of financial investors about a decade ago who viewed grains as an alternative asset in their large portfolios.
In August, 96 per cent of CBOT agricultural futures contracts were traded electronically, according to exchange data, underscoring how the personal relationships fostered by pit traders had given way to quick-hit electronic trades.
“We’re closing November first,” one of the desk staffers said, declining to be named.
“We were busy about five minutes after the open and about 10 minutes before the close but that was about it. The rest of the day there was no business.”
Spokesmen in Chicago and New York for ABN AMRO Clearing, which is owned by the nationalized Dutch bank ABN AMRO , declined to comment.
City A.M. Reporter