As a new buyer getting into the world of ingredients and commodities, it can be tough. There are a ton of things to learn and a fairly steep learning curve if you don’t have any prior experience. My goal is to take some of that confusion away. I plan to do that by starting a […]
This article is the second post in a series titled, Fundamentals of Grain Hedging: Options. In this series, I discuss different types of hedge strategies that are used around the industry by grain producers and consumers. The focus of this article is grain hedging options. In subsequent posts I will discuss more complex structures such […]
Argentina is the world’s third largest soybean producer and is incredibly important to the global oilseed trade. Unlike many other countries, Argentina does not export the beans themselves. Most of the Argentina soybean production is exported as meal and other byproducts, as can be seen in the chart below. From a crop production perspective, Argentina […]
Generally speaking, there are two different types of commodities in the world – those that are seasonally produced and those that are continually produced. The differences between the two types of commodities have major impacts on the way that you analyze the supply and demand to determine fair value. Likewise, the metrics used to discuss […]
US corn is primarily grown in the Midwestern region of the country, or the central states, where the soil is rich, deep, and the summers are ideal for growing the grain. Within that midwest region there is actually two different subsets of areas for corn growth – the Eastern Corn Belt (ECB) and the Western […]
If you’re new to futures markets, or only look at a few futures markets, you may find yourself a bitconfused by the meaning of things like ZCZ3, or ZWH3. Those symbols are called Futures Contract Codes. Each of these codes is a unique identifier and represent the commodity being traded, the deliverymonth of the contract, […]
The futures market has existed for hundreds of years. The first known market was the Dojima RiceExchange that was started in 1697. As time went on, exchanges slowly spread around the world. TheCBOT, or Chicago Board of Trade, was founded in 1848. Shortly after the LME, or London MetalsExchange, was founded 1877. These exchanges have […]
Since commodities are all derived from some natural resource, it is important to understand those natural resources, their production practices, and the underlying market conditions. Without a firm understanding of these underlying principles, it is very hard to have a firm understanding of what is driving the markets. In the grain and oilseed market primer, […]
