In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them.
The price of a commodity good is typically determined as a function of its market as a whole: well-established physical commodities have actively traded spot and derivative markets. The wide availability of commodities typically leads to smaller profit margins and diminishes the importance of factors (such as brand name) other than price.
Most commodities are raw materials, basic resources, agricultural, or mining products, such as iron ore, sugar, or grains like rice and wheat. Commodities can also be mass-produced unspecialized products such as chemicals and computer memory. Popular commodities include crude oil, corn, and gold.
List of Commodities exchange at a Global level
Agricultural
Grains, food and fiber
| Commodity | Main exchange | MIC | Contract size | Symbol |
|---|---|---|---|---|
| Corn | CBOT | XCBT | 5000 bu | C/ZC (Electronic) |
| Corn | EURONEXT | 50 tons | EMA | |
| Corn | DCE | XDCE | 10 metric tons | c |
| Oats | CBOT | XCBT | 5000 bu | O/ZO (Electronic) |
| Rough Rice | CBOT | XCBT | 2000 cwt | ZR |
| Soybeans | CBOT | XCBT | 5000 bu | S/ZS (Electronic) |
| No 2. Soybean | DCE | XDCE | 10 metric tons | b |
| Rapeseed | EURONEXT | 50 tons | ECO | |
| Soybean Meal | CBOT | XCBT | 100 short tons | SM/ZM (Electronic) |
| Soy Meal | DCE | XDCE | 10 metric tons | m |
| Soybean Oil | CBOT | XCBT | 60,000 lb | BO/ZL (Electronic) |
| Soybean Oil | DCE | XDCE | 10 metric tons | y |
| Wheat | CBOT | XCBT | 5000 bu | W/ZW (Electronic) |
| Wheat | EURONEXT | 50 tons | EBL | |
| Milk | CME | XCME | 200,000 lbs | DC |
| Cocoa | ICE | IEPA | 10 tons | CC |
| Coffee C | ICE | IEPA | 37,500 lb | KC |
| Cotton No.2 | ICE | IEPA | 50,000 lb | CT |
| Sugar No.11 | ICE | IEPA | 112,000 lb | SB |
| Sugar No.14 | ICE | IEPA | 112,000 lb | SE |
| Frozen Concentrated Orange Juice | ICE | IEPA | 15,000 lbs | FCOJ-A |
| Adzuki bean | OSE | XOSE | 2400 kg | |
| Robusta coffee | ICE | IEPA | 10,000kg |
Livestock and meat
| Commodity | Contract size | Currency | Main exchange | Symbol |
|---|---|---|---|---|
| Lean Hogs | 40,000 lb (20 tons) | USD ($) | Chicago Mercantile Exchange | HE |
| Live Cattle | 40,000 lb (20 tons) | USD ($) | Chicago Mercantile Exchange | LE |
| Feeder Cattle | 50,000 lb (25 tons) | USD ($) | Chicago Mercantile Exchange | GF |
Energy
| Commodity | Main exchange | Contract size | Symbol |
|---|---|---|---|
| WTI Crude Oil | NYMEX, ICE | 1000 bbl (42,000 U.S. gal) | CL (NYMEX), WTI (ICE) |
| Brent Crude | ICE | 1000 bbl (42,000 U.S. gal) | B |
| Ethanol | CBOT | 29,000 U.S. gal | AC (Open Auction) ZE (Electronic) |
| Natural gas | NYMEX | 10,000 million BTU | NG |
| Natural gas | ICE | 1,000 therms | NBP |
| Heating Oil | NYMEX | 1000 bbl (42,000 U.S. gal) | HO |
| Gulf Coast Gasoline | NYMEX | 1000 bbl (42,000 U.S. gal) | LR |
| RBOB Gasoline (reformulated gasoline blendstock for oxygen blending) | NYMEX | 1000 bbl (42,000 U.S. gal) | RB |
| Propane | NYMEX | 1000 bbl (42,000 U.S. gal) | PN |
| Purified Terephthalic Acid (PTA) | ZCE | 5 tons | TA |
Forest products
| Commodity | Main exchange | Contract size | Symbol |
|---|---|---|---|
| Random Length Lumber | Chicago Mercantile Exchange | 110,000 nominal board feet | LBS |
| Hardwood Pulp] | Chicago Mercantile Exchange | 20 metric tonnes | HWP |
| Softwood Pulp | Chicago Mercantile Exchange | 20 metric tonnes | WP |
Metals
Industrial
| Commodity | Contract size | Currency | Main exchange | Symbol |
|---|---|---|---|---|
| LME Copper | Metric Ton | USD ($) | London Metal Exchange, New York | HG |
| Lead | Metric Ton | USD ($) | London Metal Exchange | |
| Zinc | Metric Ton | USD ($) | London Metal Exchange | |
| Tin | Metric Ton | USD ($) | London Metal Exchange | |
| Aluminium | Metric Ton | USD ($) | London Metal Exchange, New York | |
| Aluminium alloy | Metric Ton | USD ($) | London Metal Exchange | |
| LME Nickel | Metric Ton | USD ($) | London Metal Exchange | |
| Cobalt | Metric Ton | USD ($) | London Metal Exchange | |
| Molybdenum | Metric Ton | USD ($) | London Metal Exchange |
Precious
| Commodity | Contract size | Currency | Main exchange | Symbol |
|---|---|---|---|---|
| Gold | 100 troy ounces | USD ($) | COMEX | GC |
| Platinum | 50 troy ounces | USD ($) | NYMEX | PL |
| Palladium | 100 troy ounces | USD ($) | NYMEX | PA |
| Silver | 5,000 troy ounces | USD ($) | COMEX | SI |
Other
| Commodity | Contract size | Currency | Main exchange |
|---|---|---|---|
| Palm Oil | 1000 kg | Malaysian Ringgit (RM) | Bursa Malaysia |
| Rubber | 5000 kg | US cents (¢) | Tokyo Commodity Exchange |
| Wool | 2500 kg | AUD ($) | ASX |
| Amber | 1 kg | Rub (₽) | Saint Petersburg “Bourse” |
Commodity risk refers to the uncertainties of future market values and of the size of the future income, caused by the fluctuation in the prices of commodities.[1] These commodities may be grains, metals, gas, electricity etc. A commodity enterprise needs to deal with the following kinds of risks:
- Price risk is arising out of adverse movements in the world prices, exchange rates, basis between local and world prices.
- Quantity or volume risk
- Cost risk (Input price risk)
- Political risk
Financial risk and financial risk management – Categories
- Credit risk: Concentration risk, Consumer credit risk, Credit derivative, Securitization
- Market risk: Commodity risk (e.g. Volume risk, Basis risk, Shape risk, Holding period risk, Price area risk), Equity risk, FX risk, Margining risk, Interest rate risk, Volatility risk, Liquidity risk (e.g. Refinancing risk)
- Operational risk: Operational risk management, Legal risk, Political risk, Reputational risk
- Others: Profit risk, Settlement risk, Systemic risk, Non-financial risk, Valuation risk
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