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In seeking to fulfill its mission, a substantial portion of the Commission’s resources are devoted to daily oversight of registered exchanges, intermediaries, and DCOs. In 1974, when the Commission was founded, the vast majority of futures trading took place in the agricultural sector. These contracts gave farmers, ranchers, distributors, and end-users of everything from corn to cattle an efficient and effective set of tools to hedge against price volatility.

Over the years, however, the futures industry has become increasingly diversified. While farmers and ranchers continue to use the futures markets as actively as ever to effectively lock in prices for their crops and livestock months before they come to market, highly complex financial contracts based on interest rates, foreign currencies, Treasury bonds, and securities indexes, and other products have far outgrown agricultural contracts in trading volume. Latest statistics show that approximately eight percent of on-exchange commodity futures and option trading activity occurs in the agricultural sector, while financial commodity futures and option contracts make up approximately 79 percent, and other contracts, such as those on metals and energy products, make up about 13 percent.

In FY 2010, the Commission requests $48.2 million to fund its efforts to reach the following outcomes of Strategic Goal One:

• Markets that accurately reflect the forces of supply and demand for the underlying commodity and are free of disruptive activity—with an FY 2010 performance goal of zero price manipulations that would cause loss of confidence or negatively affect price discovery or risk shifting.
• Markets that are effectively and efficiently monitored to ensure early warning of potential problems or issues that could adversely affect their economic vitality—with an FY 2010 performance goal of improving effectiveness and efficiency of market surveillance.

Breakout of Goal One Request by Outcome

Table 9: Breakout of Goal One Request by Outcome
($ in thousands)

Goal One Outcomes	FY 2009		FY 2010		Change
	Budget Request	FTE	Budget Request	FTE	Budget Request	FTE
1.1 Futures and option markets that accurately reflect the forces of supply and demand for the underlying commodity and are free of disruptive activity.	$37,922	151	$41,181	158	$3,259	7
1.2 Markets that can be monitored to ensure early warning of potential problems or issues that could adversely affect their economic vitality.	5,890	23	6,971	27	1,081	4
Total Goal One	$43,812	174	$48,152	185	$4,340	11

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