Commodity Knowledge Center - Understanding commodity trade
Commodity Knowledge Center

Understanding the unique commodity trade industry

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The commodity trade industry has many different aspects, ranging from physical commodities, commodity trading, speculative trading, commodity logistics, finance and risk management. We aim to help you understand this unique industry and all of its different facets and how it relates to our commodity trade and risk management solution (CTRM) Agiblocks through this Commodity Knowledge Center.

Unique about commodities compared to other products is the constant price movement resulting in serious challenges in business administration. These constant price movements (also known as price volatility) also introduces the need for a derivative component in this industry. Without derivatives the volatility would be increased, but instruments like commodity futures and options smoothen price bumps. The existence of both a physical and derivative market introduces the need for a specific system to accommodate administration of a commodity trade or purchase operation. A CTRM system such as Agiblocks caters to these exact needs. Each commodity has its own specialized properties to consider in a CTRM system. We’ve made all these considerations for you. 

Agiboo Tutorials
Commodity knowledge is essential to commodity trade, but also to successfully implement a CTRM solution. In our Commodity Knowledge Center you can find a host of links, articles and resources, but also a series of video tutorials to help you along. Enjoy!

Introduction
An introduction to the Agiboo Tutorials

Episode 1.1
Physical commodity contracts and its properties

Episode 1.2
Deliveries and pricing

Episode 1.3
Pricing and Fixed Contract Delivery

Commodity Trade and Risk Management

The Commodity Trade and Risk Management can be seen from three different views: Trading, Market and Risks.

Physical Commodity Management

Physical commodities require specific knowledge and sophisticated solutions in order to manage the supply chain and secure and improve the overall quality of trading activities:

Commodities

Commodities can be divided into three different groups: Agricultural, Metals and Energy.

Non-quoted Commodities

Agricultural commodities can be further divided into non-quoted commodities, as they are not actively traded on stock exchanges. They have no listings for currents prices and there are no specifications of futures contracts, but they are popular commodities from a trade perspective. Furthermore, they too are supported by Agiblocks’ commodity specializations.

We’ve categorized these agricultural non-quoted commodities into four different groups: Edible Oils, Nuts (and Tree Nuts), Seeds, (Dried) fruits and Pulses, Lentils & Peas.

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