U.S. fines Bunge $550,000 in soybeans case

Bunge Ltd., the world's second-largest oilseed processor, was fined $550,000 by U.S. regulators for entering orders for soybeans on the Chicago Board of Trade that the company had no intention of executing.

Bunge traders entered orders in March 2009 to purchase or sell soybean futures during the exchange's pre-opening session, which determines the price at which the commodity will open the day's trading, the Commodity Futures Trading Commission said Tuesday. Bunge had no intention of executing the orders, which were canceled before the open, the commodity panel said.

The orders, which constituted "false, misleading or knowingly inaccurate reports," were intended to determine the depth of support for soybeans at specific prices, and caused 'significant distortion" to the exchange's "indicative opening price," the regulator said. Susan Burns, a spokeswoman for White Plains, N.Y.-based Bunge, declined to comment.

"This is two years old, so my guess is this is a warning shot to the entire trade," said Roy Huckabay, an executive vice president for the Linn Group in Chicago. The regulator "took on the big-exposure firm to make a statement to the market," he said.

Bunge used the bogus orders to gain an advantage over other traders, the comodity panel said. "In essence, they were trying to see what orders other traders had," the agency said.

"It's a serious offense, and it may have had an impact on some large fund traders who enter orders for the opening range," said Dale Durchholz, the senior market analyst for AgriVisor. "I don't think it will have a major impact on Bunge's cash-merchandising business."

Cargill Inc. is the world's largest oilseed processor, followed by Bunge, according to Rabobank.

The fines were imposed on a subsidiary, Bunge Global Markets. Another subsidiary, Bunge North America, is based in St. Louis.

(Source: http://www.stltoday.com/business/local/article_fe6740ef-88d3-5046-bf9f-db6742b18448.html)