Commodities

[rawrschach]

I have the chance to meet some traders from places like Olam, Cargill and Dreyfus.

I really don't know anything about that sort of trading at all, any pointers or advice would be much, much appreciated, as well as a general overview of what it entails, or where I could get this info from.

Thanks.

 

[grantx]

Choc,

Look at their websites - these should provide the basics.

Grant.

 

[rawrschach]

Thanks Grant, shall do. I'd like to know how they actually trade though, which is not on their sites as far as I can tell - I m guessing that it will not be based on technical analysis and more on expected harvests and the like?

How would one deal with the delivery aspect of trading commodities?

 

[Advent]

Knowledge Center Home

 

[grantx]

Choc,

Commodities like grain, wheat, soyabean and coffee are exposed to factors common to futures products (bonds, indices, etc) but with the unique factor of weather - too hot, too cold, too much rain, not enough rain, frost. So commodity prices will change with the weather. Technical analysis is as relevant to these as to any other futures.

Re delivery, if a long position isn't closed prior to expiry you will find yourself in receipt of the commodity, eg effectively 1000 pigs dumped on your doorstep.

I googled "trading commodities" but nothing of relevance came up. However, "hard commodities" and soft commodities" produced a number of potential sites. You try the same.

Check out these articles - interesting reading:

http://www.nytimes.com/2008/04/22/business/22commodity.html
http://www.nytimes.com/2008/03/09/business/worldbusiness/09crop.html?_r=1&oref=slogin

Sorry I can't give any more help - commodities are not my area.

Grant.

 

[rawrschach]

it's a load of help, thanks very much =)

 

[rathcoole_exile]

Re delivery, if a long position isn't closed prior to expiry you will find yourself in receipt of the commodity, eg effectively 1000 pigs dumped on your doorstep.

QUOTE]

you'll notice that Grant never goes out to the shops.
he just waits to take delivery of a 5000 bushels of wheat, 10 tons of cocoa, 37500 lbs of coffee, 15000 lbs of orange juice and 112000 lbs of sugar.
the only problem is when the 40000 lbs of lean hogs take over the back garden

and he pays for it all with his 100 troy ounce bricks of gold

 

[grantx]

RC,

I don't pay for anything, mate

Reputation denied, etc. REPUTATION for the above post.

Grant.