Commodities

 

The most familiar commodities are minerals, fuels, and agricultural products. Commodities are important sources of energy and raw materials for manufacturing, transportation, and the generation of electricity.

There are many commodity markets for agricultural products such as wheat, corn, coffee, and soybeans. You can trade these futures contracts through a futures broker.

Commodities are frequently traded on futures exchanges. These exchanges include the Chicago Mercantile Exchange (CME), the New York Mercantile Exchange (NYMEX), the Commodity Exchange (COMEX), and the German Exchange (Eurex).

Commodities are raw materials that are interchangeable for a standard quality and grade. For example, crude oil is a commodity because it can be used interchangeably with other barrels of crude oil of the same quality and grade.

Commodities are raw materials or semi-finished goods which are primarily used as inputs in the production of other goods or services. Commodities are distinguished from finished goods (i.e., goods ready for sale to final consumers) as raw materials and intermediate goods are an integral part of the production process. They are bought and sold on an organized commodities market, such as the Chicago Mercantile Exchange (for futures) or physical commodity markets, like the New York Mercantile Exchange or the Electronic Commodities Market.

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