Click here to download

The sustainability of the interaction between Financial and commodity markets
Author/s: Amedeo De Cesari, Maria Leone, Alberto Manelli, Roberta Pace 
Year:  2018 Issue: Language: English 
Pages:  21 Pg. 133-153 FullText PDF:  397 KB
DOI:  10.3280/RISS2018-002009
(DOI is like a bar code for intellectual property: to have more infomation:  clicca qui   and here 

In the last ten years, the price of raw materials showed wide fluctuation and an increase in volatility. The volatility in the agricultural commodity market has aroused greatest interest because the prices of food commodities influence the survival of the people. Different studies have led different conclusions about the causes of these fluctuations. Some, following the Masters hypothesis, indicate in the increase of the speculative activity the determinant of such fluctuations. Others, instead, are critically and reported the inconsistencies of Masters hypothesis. In the following article, we analyze the wheat market, the different hypothesis of that have been proposed to explain price fluctuation and, implementing a regression analysis, we prove the uses of basis by the buyer, reseller and merchandiser of grain to achieve a profitable margin or minimize risks.
Keywords: Speculation, agricultural commodity market, regression analysis, hedg-ing.

  1. Baffes J., Dennis A. (2013). Long-term drivers of food prices, in World Bank Policy Research Working Paper 4982, Washington D.C.
  2. Bauer P., Minsch R. (2013). Commercio di materie prime agricole: croce o delizia?, Dossierpolitica Economiasuisse, 4.
  3. Black F. (1976). Valuing corporate securities: some effects of bond indenture provisions, Journal of Finance, 31(2).
  4. Da silva J.G. (2012). Food Prices Press conference. Rome.
  5. Davidson J.E.H. (2000). Econometric theory. Oxford: Blackwell.
  6. Herman M.O., Kelly R., Nash R. (2011). Not a game: speculation vs food security. Oxfam Issue Briefing.
  7. Hieronymus T.A. (1977). Economics of futures trading.
  8. Huchet N., Fam P.J. (2016). The role of speculation in international futures markets on commodity prices, Research in International Business and Finance, 37.
  9. Irwin S.H., Sanders D.R. (2010). The impact of index and swap funds on commodity futures markets: preliminary results, in OECD Food, Agricultures and Fisheries, Working Papers n. 27.
  10. Irwin S.H., Sanders D.R. (2012). Financialization and structural change in commodity futures markets, Journal of Agricultural and Applied Economics, 43(3).
  11. Irwin S.H., Sanders D.R., Merrin R.P. (2009). Devil or angel? The role of speculation in the recent commodity price boom and bust, Journal of Agricultural and Applied Economics, 41(2).
  12. Lagi M., Bertrand K.Z., Bar-Yam Y. (2011). The food crisis and political instability in North Africa and in the Middle East, in SSRN Electronic Journal.
  13. Lobell D.B., Schlenker W., Costa-Roberts J. (2011). Climate trends and global crop production since 1980, Science, 33(6042).
  14. Lorton S., White D. (2010). The art of grain merchandising. White Commercial Corporation.
  15. Masters M.W. (2009). Testimony before the committee on homeland security and government affairs. US Senate
  16. Masters M.W., White A.K. (2008). The accidental hunt brothers: how institutional investors are driving up food and energy prices. Special Report.
  17. Pecks A.E. (ed.) (1978). Views from the trade.
  18. Puma M.J., Bose S., Chon S.J., Cook B. (2015). Assessing the evolving fragility of the global food system, Environmental Research Letters, Vol. 10.
  19. Robles M., Torero M., Von Braun J. (2009). What speculation matters. IFPRI, Issue Brief 57.
  20. Stock H.J., Watson M.W., Introduction to econometrics. Pearson.
  21. US Senate (2009). Excessive Speculation in the wheat market.
  22. Working H. (1960). Speculation on hedging markets, Food Research Institute Studies, 1(2).
  23. Zoellick R. (2011). Remarks at the opening press conference World Bank. Washington D.C.

Amedeo De Cesari, Maria Leone, Alberto Manelli, Roberta Pace, in "RIVISTA DI STUDI SULLA SOSTENIBILITA'" 2/2018, pp. 133-153, DOI:10.3280/RISS2018-002009


FrancoAngeli is a member of Publishers International Linking Association a not for profit orgasnization wich runs the CrossRef service, enabing links to and from online scholarly content