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Related to commodity: Commodity market, Commodity Futures


A commodity is food, metal, or another fixed physical substance that investors buy or sell, usually via futures contracts.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.


A generic, largely unprocessed, good that can be processed and resold. Commodities traded in the financial markets for immediate or future delivery are grains, metals, and minerals. They are generally traded in very large quantities. See also futures contract.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.


Commodities are bulk goods and raw materials, such as grains, metals, livestock, oil, cotton, coffee, sugar, and cocoa, that are used to produce consumer products.

The term also describes financial products, such as currency or stock and bond indexes.

Commodities are bought and sold on the cash market, and they are traded on the futures exchanges in the form of futures contracts.

Commodity prices are driven by supply and demand. When a commodity is plentiful -- tomatoes in August, for example -- prices are comparatively low. When a commodity is scarce because of a bad crop or because it is out of season, the price will generally be higher.

You can buy options on many commodity futures contracts to participate in the market for less than it might cost you to buy the underlying futures contracts. You can also invest through commodity funds.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.


any economic GOOD but in commercial circles more specifically agricultural produce and minerals such as wheat, tea, copper, iron ore, etc. See COMMODITY MARKET, INTERNATIONAL COMMODITY AGREEMENT.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson


  1. 1see GOODS.
  2. raw materials rather than goods in general: for example, tea, coffee, iron ore, aluminium, etc.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
'The development of a regulatory framework for commodity exchanges will augment the government's efforts on enhancing food security and making the commodities market competitive, improving efficiencies in the value chain and meeting international standards,' CMA added.
dfcu's structured Commodity Finance is designed for commodity producers and trading companies doing business in the developing market.
The growing interest in commodity markets can be measured by various indicators.
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In most Asia-Pacific markets, we do not expect negative bank rating actions related to commodity exposures, because the banks in general have either good financial buffers, moderate commodity exposures, or their ratings capture asset quality weakness, Moody's said.
It is easy to forget that it was only a few months ago that still-plunging commodity prices were among the perceived harbingers of an impending global recession.
It was highlighted that the SECP was committed to bringing about reforms in agricultural commodity trading by encouraging traders to make use of the platform of Pakistan Mercantile Exchange Limited (PMEX) as a modernized route for buying and selling agricultural commodities in Pakistan.
But its role in the sharp fall in commodity prices that has occurred since 2014 -- an outcome that has been devastating for commodity-exporting countries, including once-dynamic emerging economies -- is more limited than the conventional wisdom suggests.
Dubai, Sept 21 (ONA) Dubai Mercantile Exchange "DME," the premier international energy futures and commodities exchange in the Middle East, today announced the launch of "DME Auctions," the first platform in the Middle East that will provide a transparent spot commodity auction system.