THE Chicago Mercantile Exchange (CME) changed its name from the Egg and Butter Board in 1919 but many investors still refer to it as the “pork belly” market.

Terrence Duffy, chairman of the CME, is used to this anachronistic view. “When we decided to float in 2002, investors expected us to walk in like Farmer Jones, with hay between our teeth,” he said. “It was a surprise when we told them things like the fact we had invented futures trading.”

To investors whose knowledge is still lacking, the CME could be about to deliver another shock: it is emerging as the favourite not just to lead global consolidation but to snap up the London Stock Exchange (LSE) as well.

Last week, after Australia’s Macquarie bank dropped its hostile £1.5 billion bid for the LSE, the European bourses Euronext and Deutsche Börse hinted that they had rekindled merger talks, leaving the path for advances from American exchanges more open than ever.

Duffy, however, made it clear he will not be rushed into a deal. But whether consolidation in the exchanges is imminent or not, the American bourses are showing a sense of urgency as they jostle to get the best position.

Last week, the New York Stock Exchange (NYSE) was still waiting for approval of its merger with Archipelago which will transform the exchange into a public company with a market value of $8 billion (£4.6 billion).

Meanwhile, arch-rival Nasdaq, the technology exchange, launched a new tier of blue-chip companies in a move that was seen as creating competition for the NYSE and as an attempt at diversification and modernisation.

Duffy is dismissive of the threat posed by other exchanges such as the NYSE and Nasdaq, which have been named as suitors for the European bourses, particularly the LSE.

“All the other exchanges are racing to replicate the CME,” he said. “We have been so successful that others have been forced to follow whether they wanted to or not.”

Duffy joined the CME as a runner at 21. He then persuaded his parents to remortgage their house to pay for a deposit for his membership at the CME. Over 20 years later, in April 2002, he was made chairman and immediately started preparing for a float.

“We decided to get on and do it,” he said. “The world was moving rapidly. Deutsche Börse has been launched as an entirely electronic exchange. We had to move or close. It was as simple as that.”

The CME share price has soared from $35 when it floated in December 2002 to $422.65 on Friday. Trading volume is growing at a rate of 40% a year.

“The CME is already the only global exchange,” said Duffy. “More than 10% of our volume has been non-American and done through our telecom hubs across the world. We have spent $1 billion on technology in the past seven years. We can handle 5,000 transactions a second. If you want to trade, it’s gone through our systems before you can blink.”

The bulk of the CME’s business is trading interest rates, equity indexes, foreign exchange and alternative investments. Duffy has created strategic alliances, such as settling volumes with the Chicago Board of Trade, and is in the process of launching products for European markets. Business from new clients such as the hedge funds is booming too.

Although Duffy insisted this was just normal growth rather than grooming for a merger, he said the CME’s profile ought to be attractive.

“The CME has an advantage over other exchanges because of the scale of its operations,” he said. “We have a bright future in global consolidation.”

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