CHICAGO'S commodities exchanges urgently and obviously need reform, but it won't happen this year. There's a bill to impose newand better rules on trading in financial futures, but it was locked all summer in a quarrel over different versions, and the eventual compromise came too late. The Treasury Department and some of the bill's sponsors have been trying frantically this week to get a vote on it, but without success. The chairman of the Senate Agriculture Committee, Patrick Leahy (D-Vt.) , delivered a bitter funeral oration: "It is an embarrassment to this chamber and to President Bush's administration that we have not enacted this bill into law."

You would think that the case for reform was more than sufficiently clear. Early last year an FBI sting operation produced evidence of widespread corruption in both the Chicago Board of Trade and the Chicago Mercantile Exchange. So far 48 people have been indicted. There was another upheaval the following summer when an Italian trading company apparently tried to corner the market in soybeans. Several months later one of the Mercantile Exchange's directors, former senator Thomas F. Eagleton, resigned accusing the exchange of interfering, in still another case, with a federal investigation of fraud. Last summer the chairman of the Board of Trade resigned, and the firm he led went into liquidation after federal regulators charged it with misusing funds.

Sen. Leahy's committee had worked out legislation to improve the operation of those exchanges. But the Treasury had a further objective. Unlike the Agriculture Committee, it was worried about the way that the futures markets affect the stability of the stock markets. Loosely regulated trading in financial futures bears a significant part of the blame for the 1987 stock market crash, and the Treasury wants them brought under the same policeman -- the Securities and Exchange Commission -- that oversees the stock markets. That has set off a turf war with a rival agency, the Commodity Futures Trading Commission. Behind that struggle lies a larger one between the Chicago markets, trying desperately to keep their hold on the rapidly growing business in financial futures, and the New York markets, trying to get a bigger share of it. The result has been a stalemate.

"The public sits in the middle," Sen. Leahy observed, "and gasps at the absurdity of important reforms being killed in the cross-fire." Meanwhile, trading in financial futures continues on a gigantic scale under laws that are demonstrably inadequate to protect the public.