SOME BASIC FORCES WHICH LEADS THE COMMODITIES MARKET

Commodity exchange market is the market in real sense. From the beginning of social relation among the human in history this type of trading started between the two types of persons one is called buyers and other is called sellers. In this market people trade in commodities and no concept of currency prevails. One person provides his commodity to the second person and in exchange first person receives another commodity from second person. This trade is done on some standers. This basic concept of commodity trading market of ancient times is still prevailing in the modern commodities trading markets. The people have to trade their commodities with the others commodities without the intervention of money.

To understand the basic forces which lead the commodity market following division is made in the form of problems and benefits of commodity market. This division of favorable and against factors is given in the following paragraphs to understand the commodity market easily.

Problems faced by traders in commodities market

•           Cost of carry

•           Cost of insurance

•           Cost of storage

•           Perish-ability of goods  

When a trader went to trade his goods in commodity market he has to face some problems during the process of trading in commodity market. Few are discussed here. First of all he has to face the cost of carrying his commodity to the market. If you have to trade with money this type of cost does not occur and traders don’t have to think about this problem. Moreover during transportation there can be any kind of damage occur. To avoid suck risk trader have to insure his commodity with some good insurance company.

In addition to that cost of storage is inevitable in trading under the system of commodity market. The reason is that there can be time between arrival of commodity to the market and the departure of traded products to the buyer. Therefore during that time commodities must be stored on safe and suitable place. This thing also generates an expense called cost of storage. Perish-ability of goods also create some problem especially when there prevails some idle time between the arrival of goods to the market and departure of goods to the buyer. Sometime goods are more perishable while others are less perishable however the risk of getting the commodity spoil exists.    

Benefits of commodity market

As mention in the introductory paragraph commodity market is the oldest way of trading in human history. There are number of benefits in trading the commodities rather than sale purchase through money. In the following paragraphs few benefits are given:

•           Low effect of economic rescission's

•           Availability of commodity on the spot

•           Low risk of loss

•           Natural way of trade

Commodity market bears some advantages over other type of trading. In commodity market economic rescission's can shed low effects. Reason is that the price of commodities does not fluctuate as frequent as the prices of currency fluctuate during economic crises. Moreover currency rates vary with every minute event in economic field. While the effects of these events reaches to commodity market after a certain period. This factor makes money market little safe and less fluctuating market. However the net effect of economic changes reaches the commodity market and shows its effects on trade in commodity market.

Another benefit of commodity market is that in most of the cases commodity remain available in the market for trade. This thing not only attracts the customers but also make him satisfied with the physical view of commodity. Customer can check the quality and quantity of Commodity at the spot and also can assess the value of the commodity at first hand. This thing reduces the risk of loss for both the seller and the buyer. Hence the trader feels more comfortable while trading in commodity market rather than the other mode of trade. These factors make the commodity market more successful than the other types of trade markets.

Above said are the basic concepts which lead the commodity market and cause the rise and fall of market in its operations. Anyone who is interested in commodity market for trade must understand these factors and forces and must keep in mind while trading in this market. These factors can make him successful and also can case the loss in trade for him. You can Trade with [b binary] for quick profits and fast, easy withdrawals. Moreover receive a 100% match bonus on your first deposit. These offers by the bbinary are matchless and attractive.

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THE REASON OF FALLING TREND IN OIL PRICES

In the last quarter of 2011 oil prices continuously rises and this trend continues for further first quarter of 2012. However, in April oil prices start taking u-tern and the price of oil start falling. This trend is continuous till the second week of June. Till second week of June oil already has lost its price up to 20 percent. This is a big downfall of the oil prices. Many analysts try to explain the real reasons of falling prices of oil. But most of the analysts could not present the solid reason for the price fall. In this article I want to present my opinions about the present fall in prices of crude oil and its affiliated products like gasoline, diesel etc. 

It is the basic rule of economics that prices will fall down if the supply of commodity in the market becomes larger than the demand. This law could be seen applicable in the market in different shapes. Under the present conditions this law also holds on the demand and supply of fuel oil. In the first appearance this reason does not have weight but if you go in details everything will be clear and you will find the actual reason is the difference in demand and supply of the oil in the market. Here are the details:

Due to the continuous economic recession during last few months the economies of most of the countries are struggling. Every country is trying its best to meet the challenges offer by this economic slump. Due to economic crisis purchasing power of the majority of the customers fall down and the people start thinking about their spending. This thinking creates the situation called pullover of customers in the market. When this happened it shed adverse effect on the sales of almost all the products in the market. Some products got big effect while other feels low pressure. The ultimate influence of this trend converges on the fuel demand because fuel is the essential thing in manufacturing of the products. When the customers do not go to the market the sale of commodities fall down which also affects the production processand when production falls the demand of fuel also fall down which ultimately affects the prices of fuel.

Same is the case with the oil prices in the present year. Everyone is thinking to cut their spending to meet the expenses from their limited means of income. This trend affects the sale in the market and the manufacturer become more vigilant about the extra production and ultimately the prices of fuel oil dropped gradually up to the level of 20 percent. In other words economic crisis is indirectly affecting the prices of crude oil and its related products. Taking in view the above discussion it is clear that prices of oil will continue to fall till it reaches the certain level and after that it will start rising due to the limited supply of the oil by the oil producer countries. It is the natural process that manufacturer only operates on the certain level of prices and after that level the manufacturer do not want to produce the commodity because after that level it become unviable for him to continue the manufacturing process. Same will be the case with the oil producer countries and they will slow down the production of the oil and in the result once again oil start raising its prices.

However it depends on that certain level that how rapid that level of prices reaches. If it reaches in few weeks that you will see the rising prices of oil in the next month and if it takes some time than you can enjoy the low prices of oil in the international market.

Taking in view the situation experts are advising the investors to invest in the commodities rather than in oil or currencies. For this purpose there are some good commodities trading companies which offer their services to the investors to trade in commodities and save their time and money. One such company is traderush. This company is working with the motto “Trade with [traderush] for quick and rapid profits, easy withdrawals.No payment, no spreads or hidden fees”. One can avail the help of these companies for making money in the trade of commodities market.

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Commodity | COFFEE,GOLD,OIL,PLATINUM,SILVER,SUGAR, WHEAT

COFFEE,GOLD,OIL (LIGHT SWEET CRUDE),PLATINUM,SILVER,SUGAR,

WHEAT

A commodity is defined as goods for which there are demand in a market, but which is supplied without any differentiation in the market. The commodity market is divided in four segments and from it copper from base metals and petroleum from oils are main fluctuating ones copper fluctuates daily based on global supply and demand. So this can be considered as one of the characteristics of a commodity market good is that its price is determined as a function of its market as a whole. In commodity market well-established physical commodities is traded actively in intraday or spot market and other one is derivative market. There is another important class of energy commodities which includes electricity, gas, coal and oil. As commodities were things of value, of uniform quality, that were produced in large quantities by many different producers and the items in commodity market from each different producer were considered equivalent and traded on commodity exchange, it is based on standard stated contract that defines the commodity, not any quality inherent in a specific producer's product. Commodity is mainly traded on a commodity exchange and the list of some main exchanges are as follows:

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AUSTRALIAN ECONOMY IS AN EMERGING ECONOMY OF THE WORLD

Australia is the big country and occupies more than 90 percent of the Australian continent. There is vast land and diverse geological climatic areas. In Australia there are unlimited opportunities for earning. In last few decades many nations get attracted to take the advantages of resources in Australia. Recently in last decades Chinese make great contribution in the mining fieldof Australia. They have invested huge money in this field and get the advantage of mining. They generally obtain raw materials from Australian mining fields and bring that raw material in their industry to meet the need of their industry. It is try to say that the rapid growth of Chinese economy is the result of investment in mining filed in Australia.

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THREE BASIC CONTENTS OF COMMODITY MARKET

THREE BASIC CONTENTS OF COMMODITY MARKET

Trading commodity with commodity is the essence of commodity market. This type of trading started in the human history in very beginning. When human started creating their societies a need of exchanging products appears and early human societies started these types of activities in their societies. It means commodity market is old age concept. In human social life commodity market had been playing vital role because in old time people deals with one another through this system of trade. After very long time concept of money come into existence and people started trading with money. With the use of currency, however, commodity market doesn’t lose its importance in human societies and even in this modern age these types of markets are operating and are considered very important mean of trading.

Commodity is the thing which is demanded in the market and also provided by the supply sources without any discrimination. Mainly commodity market has three basic segments. According to these segments the operations of commodity market can easily be explained. The entire events take place in commodity market remains under the influence of these factors. You can say these three segments are the driver of commodity market. These basic segments are:

• Agriculture products Wheat, sugar, edible oils etc.

Agriculture products are the basic need of every society and every society has to manage enough supply of agriculture products to meet their food needs. Taking in view the importance of food items like Wheat, sugar, edible oils etc. in society every country manage a well operated and well managed commodity market which make the supply of foods items sure to the country. Therefore every country in the world has established own commodity market to trade with the other commodity markets in the world for dealing the issues of agriculture products.

It is a fact that agriculture sector is mainly dependent on natural climatic conditions and weather conditions don’t remain favorable in all parts of the world. The unfavorable climatic changes affect the crops in different parts of world and in those areas there can be shortage of some agriculture commodities. Therefore due to shortage of deficient commodities like Wheat, sugar, edible oils etc. in the climatically affected areas they need extra some supply of those commodities from the other areas. Under such situation agriculture commodity market plays very important role. Similarly the areas where agriculture products are not grown in sufficient amount they also need to import agriculture products to meet their needs.

In the above lines few factors which affect the operation of commodity market are given which also show the importance of commodity market for a country.

.  

•           Rare Metals

Man always remains interested in rare metals like gold, platinum, silver etc. Due to this interest and rarity of these metals generate a special charm of these metals in the mind of man. That is why everyone likes to have rare metals in his possessions. Moreover these metals had been in use as a currency. Due to this character of rare metals these had been in trade in the world. Commodity market also deals in rare metals. A major part of commodity market operates on trading of rare metals. Especially gold is considered as a stander for trading any other commodity. Therefore it is clear that in the operation of commodity market rare metals acts as catalyst to in enhance its operations. Moreover due to economic changes in the world people like to invest in rare metals because these metals don’t lose their value due to economic recession and the investor escape from any loss. These are the few major reasons of importance of rare metals for commodity market. However, there are lots of other reasons which make rare metals the operator of commodity market

.

• Minerals

Importance of energy is vital for every progressing society and the major part of energy needs comes from the fossil fuels like crude oil, petroleum products, Cole etc. Taking in view the importance of energy minerals oils and other related commodities are traded in commodity market frequently. A large portion of commodity market comprises of the transaction of minerals and their related items like crude oil, petroleum products and Cole. The countries which could not produce fossil fuels from their country they import these commodities from those who have these commodities in abundance.

In the above article a brief account of three major parts of commodity market are discussed for the explanation of contents of commodity market for those who want to know about the basics of commodity market and its operation. The new comers in commodity market can rely on some prominent companies like binary and can Trade with [binary] for quick profits and fast, easy withdrawals. They are secure and you will receive a 100% match bonus on your first deposit.

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