Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain?
The instability of commodity prices and the hypothesis that speculative behaviour was one of its causes has brought renewed interest in futures markets. The paper analyses the European wheat futures markets (feed and milling) and the Chicago Board of Trade’s wheat contract as a comparison. Although...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Firenze University Press
2013-10-01
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| Series: | Bio-based and Applied Economics |
| Subjects: | |
| Online Access: | https://oaj.fupress.net/index.php/bae/article/view/3244 |
| _version_ | 1819052013190643712 |
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| author | Cesar Revoredo-Giha Marco Zuppiroli |
| author_facet | Cesar Revoredo-Giha Marco Zuppiroli |
| author_sort | Cesar Revoredo-Giha |
| collection | DOAJ |
| description | The instability of commodity prices and the hypothesis that speculative behaviour was one of its causes has brought renewed interest in futures markets. The paper analyses the European wheat futures markets (feed and milling) and the Chicago Board of Trade’s wheat contract as a comparison. Although the main purpose of the paper is to analyse whether futures markets are still useful for hedging (considering the demands from different market participants), implicitly this can be seen as testing whether the increasing presence of speculation has made futures markets divorced from physical markets. The results indicate that hedging with futures markets is still a viable alternative for dealing with price risk. This is particularly true in short period hedges (e.g. merchants and processors), where the basis seems to have been affected by the observed price instability. |
| first_indexed | 2024-12-21T12:13:05Z |
| format | Article |
| id | doaj.art-5ada234580d5461ca2bae084a4f0466f |
| institution | Directory Open Access Journal |
| issn | 2280-6180 2280-6172 |
| language | English |
| last_indexed | 2024-12-21T12:13:05Z |
| publishDate | 2013-10-01 |
| publisher | Firenze University Press |
| record_format | Article |
| series | Bio-based and Applied Economics |
| spelling | doaj.art-5ada234580d5461ca2bae084a4f0466f2022-12-21T19:04:31ZengFirenze University PressBio-based and Applied Economics2280-61802280-61722013-10-012310.13128/BAE-1295211498Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain?Cesar Revoredo-GihaMarco Zuppiroli0Università degli Studi di ParmaThe instability of commodity prices and the hypothesis that speculative behaviour was one of its causes has brought renewed interest in futures markets. The paper analyses the European wheat futures markets (feed and milling) and the Chicago Board of Trade’s wheat contract as a comparison. Although the main purpose of the paper is to analyse whether futures markets are still useful for hedging (considering the demands from different market participants), implicitly this can be seen as testing whether the increasing presence of speculation has made futures markets divorced from physical markets. The results indicate that hedging with futures markets is still a viable alternative for dealing with price risk. This is particularly true in short period hedges (e.g. merchants and processors), where the basis seems to have been affected by the observed price instability.https://oaj.fupress.net/index.php/bae/article/view/3244futures marketswheathedgingcommodity prices |
| spellingShingle | Cesar Revoredo-Giha Marco Zuppiroli Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? Bio-based and Applied Economics futures markets wheat hedging commodity prices |
| title | Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? |
| title_full | Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? |
| title_fullStr | Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? |
| title_full_unstemmed | Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? |
| title_short | Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain? |
| title_sort | commodity futures markets are they an effective price risk management tool for the european wheat supply chain |
| topic | futures markets wheat hedging commodity prices |
| url | https://oaj.fupress.net/index.php/bae/article/view/3244 |
| work_keys_str_mv | AT cesarrevoredogiha commodityfuturesmarketsaretheyaneffectivepriceriskmanagementtoolfortheeuropeanwheatsupplychain AT marcozuppiroli commodityfuturesmarketsaretheyaneffectivepriceriskmanagementtoolfortheeuropeanwheatsupplychain |