Agricultural Commodities

Agriculture is the cultivation and breeding of animals and plants to provide food, fiber, medicinal plants and other products to sustain and enhance life. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that enabled people to live in cities.

Agricultural commodities are easily classified into three major categories:

 

 

Grain, Food & Fiber

These includes:

Farmers grow these commodities as

• a food source for humans,

• a food source for the animal,

• as a feedstock for fuels (in some cases) Most common grain commodity is wheat, corn, oats, barley and rough rice.

Farmers grow them for (a) the high oil content in their seeds and (b) the meal that remains after oil is extracted:

• Canola

• Cotton

• Palm Oil

• Soybeans.

These mostly refers to other farmed products such as:

• Cocoa

• Coffee

• Frozen Concentrated Orange Juice (FCOJ)

• Sugar

• Dairy such as Milk, Butter, Whey, Cheese.

 

 

Meat & Livestock

Meat commodities include:

1. Live animals raised for meat, hide, organs, bones and hooves

2. Cuts of meat produced during the butchering of animals:

       • Feeder Cattle

       • Live Cattle

       • Lean Hogs

 

Miscellaneous Agricultural

Some commodities have well-developed global markets but don’t fit easily into the above categories:

• Lumber

• Rubber

• Wool

Many of Agricultural commodities are not widely traded by global and speculative investors but mostly driven by actual market demand.