Commodities

Commodities: raw and basic materials

This is the English word designating raw materials, and more generally basic materials, whether metallic, agricultural, energy, etc. These products show few differences from one supplier to another, most often being standards whose origin is of little importance for the use made of them.

As such, they are most often reprocessed and/or worked before being used.

A market apart
Commodities are traded on spot markets or derivative markets. Some stock exchanges specialize in commodity transactions, such as the Chicago Stock Exchange, the oldest food trading exchange in the world.

The price of commodities: an influence on the world market
The variation in the price of Commodities can have a considerable impact on the finished products. The consequences can be significant in other areas and sectors. Thus, the price of agricultural raw materials can impact the entire agri-food industry. As for energy prices (gas, oil, etc.), their repercussions on the whole economy in general are obviously known to everyone.

Financial markets also have a significant impact on the price of commodities
Certain raw materials, in particular precious metals, are inversely correlated to financial market prices. As a safe haven, they appreciate when stock market indices decline and vice versa.