The Futures Market: A Valuable Commodity

The agricultural goods futures market has recently regained the interest of corporate business, research institutions, and governments. This renewed interest is brought about by the increasing volatility of the prices of agricultural raw materials. In turn, these reflect the shift that has taken place in the European Union’s joint agricultural policy: from price support to income support and to market liberalization under the terms of the World Trade Organization. Corporate life is looking for instruments to limit price risk and is increasingly turning to futures contracts in the process. The goods futures trade is not a recent phenomenon. Sayous (1936) described how wool futures were traded in Spain as early as 1543. The Netherlands already had a futures trade in the 16 century as well, especially for grains. However, these futures contracts were not cleared yet, as is the custom nowadays.