February 24, 2017 / 8:58 PM / 7 months ago

ADM brokerage arm shifts more trades onto computer screens

CHICAGO (Reuters) - ADM Investor Services (ADMIS), a futures commission merchant owned by global grain trader Archer Daniels Midland Co, will begin executing more of its orders electronically beginning on March 1, the company said on Friday.

All orders sent to its Chicago Board of Trade trading floor desk will be executed by the brokerage’s 24-hour trading desk and entered via Globex, the electronic trading platform owned by CBOT parent CME Group Inc, ADMIS President Tom Kadlec said in an emailed statement to Reuters.

ADM’s global trading operations have come under pressure over the past year, a particularly volatile one for commodities markets. The company’s global trading desk reported quarterly losses in two of four quarters in 2016 and several key traders and others have left the company.

The move is the latest in an industry-wide shift to computer-based trading and away from the sometimes raucous open-outcry pits, where traders shout and use hand signals to swap futures and options.

Open-outcry trading volumes have been fading since the advent of electronic trading more than two decades ago.

In 2015, CME Group closed its historic agricultural futures pits in Chicago and consolidated open-outcry trading, including agricultural options, from two trading floors to one. CME Group closed its New York trading floor at the end of 2016, leaving products like gold and oil traded at its NYMEX and COMEX exchanges available only for electronic trading.

“More than 90 percent of ADMIS option contracts are entered on the Globex platform. At this time, no decision has been made to close the ADMIS floor desk at CME,” Kadlec said.

It is unclear if any jobs would be eliminated. The company did not immediately respond to follow-up questions.

Editing by Matthew Lewis

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