Commodity Markets Research Articles

Capitalist, Evolution, Financial Innovations and Financial Literacy: A Study of their Dynamics in Shaping Modern Capitalism

Finance has had its root in human history since human being started a settled civilized life. As production for trade took a shape, various means of transactions and storage of value kept on evolving. Gradually, finance took the center stage with the evolution of modern capitalism. In early stages the financial instruments remained a scattered individual means of financial practice, no central regulation existed in the early era. Hence the acquaintance with these instruments was also confined to individual users, the traders, particularly. Since economic productivity was quite low, ordinary individuals had little surplus to save, not many had much to do with financial literacy. The modern capitalism required industrial workers, surplus of agricultural products, more consumers for market, more means of production to produce trade surplus and more financial savings and instruments to channelize investments. Also the producers were required to be alienated from the product of labour so that the trade of commodities could be taken in control by the trading class. Also the means of production, which was otherwise the ownership of the households, was to be turned marketable to facilitate the transfer the ownership from ordinary owners to the trading class. The trinity of commodity production, wage labour and market system altogether had to evolve for capitalism to come into existence. Accordingly, various financial instruments took shape, the traditional ones became more formalized and many new ones were invented. The evolution of different forms of business, the 'company' form particularly, helped this process in a big way. Simultaneously, the financial anarchy put the systems in turmoil and hence regulatory bodies became a compulsion. These regulatory bodies assumed the twin role of regulation of financial markets, financial facilitation, as well as creating financial literacy among ordinary people to link their savings to the mainstream trade and commerce lines. The paper attempts to portray the evolution of modern financial system and find out how this evolution has been linked to the financial literacy of the common masses. Also the paper would throw lights on imminent market and systemic hazards caused by excess leliance on financialisation of economic system.

The role of a small town in the flow of agricultural commodities with its hinterlands before and after the construction of the Trans Sumatra Toll Road (case study: Kalianda District South Lampung Regency Indonesia)

Linkages between rural and urban areas assist numerous regions in a variety of ways. As a meeting place for villages and cities, a small town with hinterlands of agricultural areas acts as a market for village commodities, intermediary markets in larger markets, places for agricultural processing, places for production facilities, and a center for other activities. The construction of the Trans Sumatra Toll Road (JTTS), which crosses Kalianda District as a small town connecting several big cities, allows Kalianda alters its role. This study aims to examine the flow of agricultural commodities in a small town and its hinterlands and analyzed the role of small towns before and after the construction of JTTS. The data analysis was carried out by creating an Origin-Destination Map and providing the description. The results showed that seven agricultural commodities sold in Kalianda Market came from seven sources (origin), while commodities in rural areas had four selling destinations area. The small town illustrates its proper function as an intermediary market for larger markets, centers of health activities, administrative services, and banking services. However, the small town has not been able to play much of a role as an intermediary market for larger markets, rural commodity processing places, and places to find high-order goods. The small town is also incapable of being a destination for the identification of agricultural production facilities. In general, the existence of JTTS does not significantly change the role of small towns.

KEY ASPECTS OF THE TRANSFORMATION OF THE CHARACTER OF COMPETITION ON THE UKRAINIAN FOOD MARKET

The set of opportunities of an agricultural enterprise to create competitive advantages make up the potential of its competitiveness. However, competitive advantages, especially those that can be characterized as sustainable, are formed on the basis of the mobilization of the economic potential of the enterprise, which is a set of opportunities for the long-term implementation of the main activity of the business entity. Accordingly, the study identified the place and role of the potential of competitiveness in the structure of the enterprise's potential and its relationship with the economic potential. In turn, it was established that the components of economic potential are production potential in combination with commercial and sales opportunities, the basis of all types of enterprise potential is resource potential, and the potential of product competitiveness and enterprise competitiveness is based on the economic potential of the enterprise, contributing to the growth of the latter. Agricultural producers face many problems that can prevent them from growing and selling their products profitably. The problem of ensuring the effective economic activity of the studied subjects of agricultural production lies in the relative complexity of the relationships between them within the framework of the current market environment. the market environment of the functioning of commercial structures is not homogeneous, and the levers of state regulation do not have an unequivocal effect on all operators of one or another commodity market at the same time. To increase productivity and expand participation in market relations, they absolutely need appropriate mechanisms and policy measures. In the current situation, it becomes necessary for each manufacturer to analyze its competitiveness and develop effective means to increase it. An important condition for ensuring the competitiveness of enterprises is the effective use of resources, personnel qualifications, achievements of modern management, innovative, financial and informational capabilities of the enterprise, which together represent its potential. State determination of the legal field of existence of market participants requires a clear understanding of the relevant state of their interaction and the development trends of this interaction. The consequences of agricultural regulation policy and the manifestation of market forces in relation to the productivity and evolution of the food industry vary depending on the field, direction of production, etc.

Framing the housing crisis: politicization and depoliticization of the Dutch housing debate

How does a housing crisis become a crisis? In answering this question, this paper turns to framing in public and political debate. The case is the Netherlands where in the decade following the Global Financial Crisis the debate on housing quickly developed. Drawing on a discursive analysis of parliamentary documents, newspaper items, and interviews, the paper reveals how a housing crisis frame became central in debate, through a sequence of incubation, development and escalation. These debates shown signs of politicization as they increasingly emphasize the structural causes and political roots of the current situation, while also framing housing as primarily a fundamental right rather than a market commodity. This politicization, however, is matched by depoliticizing tendencies as relatively much attention is directed to the housing issues of the middle classes and young adults. Findings help us understand how housing struggles are understood, and which policies are deemed acceptable and necessary.

Dynamic connectedness, portfolio performance, and hedging effectiveness of the hydrogen economy, renewable energy, equity, and commodity markets: Insights from the COVID-19 pandemic and the Russia-Ukraine war

This study employs a Time-Varying Parameter Vector Auto Regressive (TVP-VAR) connectedness approach to investigate the dynamic interconnections, portfolio performance, and hedging effectiveness across hydrogen economy, renewable energy markets, equities, and energy commodities amidst the backdrop of the COVID-19 pandemic and the Russia-Ukraine conflict. Our findings reveal a consistent level of average connectedness during both black swan events, with dynamic connectedness reaching its peak during the COVID-19 crisis. While some assets (hydrogen economy index, renewable, solar and clean technology index) persistently function as net transmitters, the others (geothermal index, crude oil, natural gas, biofuel, and gold) consistently act as net receivers. We also find that the role of equity indices (wind energy, fuel cell, FTSE_100, and S&P 500) as net transmitters or receivers changes over time. The network plot results show that the hydrogen economy typically functions as shock transmitters for equity market indices and commodities. Portfolio analysis underscores the superior risk-adjusted performance of the minimum variance (connectedness) portfolio during the COVID-19 crisis in comparison to the Russia-Ukraine conflict. Furthermore, our examination of effective hedge and portfolio strategies demonstrates that managed collateralized portfolio weights of hydrogen economy and renewable energy assets (equities) in the minimum variance portfolio increase (decrease) from 7% to 12% (53%–41%) during the COVID-19 crisis, and subsequently decline (rise) further to 6% (53%) amidst the Russia-Ukraine conflict. These findings suggest a preference for hydrogen economy and renewable energy assets as hedging instruments in health-related financial crises over crises precipitated by military conflicts.

Interconnected Markets: Unveiling Volatility Spillovers in Commodities and Energy Markets through BEKK-GARCH Modelling

Food commodities and energy bills have experienced rapid undulating movements and hikes globally in recent times. This spurred this study to examine the possibility that the shocks that arise from fluctuations of one market spill over to the other and to determine how time-varying the spillovers were across a time. Data were daily frequency (prices of grains and energy products) from 1 July 2019 to 31 December 2022, as quoted in markets. The choice of the period was to capture the COVID pandemic and the Russian–Ukrainian war as events that could impact volatility. The returns were duly calculated using spreadsheets and subjected to ADF stationarity, co-integration, and the full BEKK-GARCH estimation. The results revealed a prolonged association between returns in the energy markets and food commodity market returns. Both markets were found to have volatility persistence individually, and time-varying bidirectional transmission of volatility across the markets was found. No lagged-effects spillover was found from one market to the other. The findings confirm that shocks that emanate from fluctuations in energy markets are impactful on the volatility of prices in food commodity markets and vice versa, but this impact occurs immediately after the shocks arise or on the same day such variation occurs.

Return and Volatility Spillover in Equity and Commodity Market: Some Indian Evidence

This study empirically investigates the return and volatility spillover among equity markets, Agro and non-Agro commodity markets. The study has used daily return data of BSE SENSEX as equity index, MCX iCOMEDEX, including Gold, Silver, and Crude oil, as non-agro indices, and NCDEX (AGRIDEX) as agro commodity indices to analyze volatility transmission between assets and markets using Generalized Autoregressive Conditional Heteroscedasticity (GARCH) and Exponential Generalized Autoregressive Conditional Heteroscedastic (EGARCH) model. The study has used dummy variables in the variance equation to identify the structural breaks during the COVID 19 pandemic. Further, Vector Auto Regression (VAR) pair-wise Granger causality test has been used to understand returns’ causality. The study has found a bidirectional and unidirectional causal relationship between variables. The study indicates that NCDEX could influence all the variables except MCX Gold. In structural breaks with deterministic dummy variables during COVID-19, we have found mixed evidence of asymmetric impact on conditional volatility. The study also indicates a positive and significant asymmetric volatility effect in the case of MCX Gold and MCX Silver during the COVID-19 period. The study has specified that SENSEX dominates the inflow of information to all commodity markets. Also, the findings signpost that information flows from NCDEX to MCX Gold, MCX Silver, and MCX Crude Oil. JEL Codes: C32, E30, E44, F41, G15, Q43

Asymmetric Effects of Uncertainty and Commodity Markets on Sustainable Stock in Seven Emerging Markets

The increase in global economic policy uncertainty (EPU), volatility or stock market uncertainty (VIX), and geopolitical risk (GPR) has affected gold prices (GD), crude oil prices (WTI), and stock markets, which present challenges for investors. Sustainable stock investments in emerging markets may minimize and diversify investor risk. We applied the non-linear autoregressive distributed lag (NARDL) model to examine the effects of EPU, VIX, GPR, GD, and WTI on sustainable stocks in seven emerging markets (Thailand, Malaysia, Indonesia, Brazil, South Africa, Taiwan, and South Korea) from January 2012 to June 2023. EPU, VIX, GPR, GD, and WTI showed non-linear cointegration with sustainable stocks in seven emerging markets and possessed different asymmetric effects in the short and long run. Change in EPU increases the return of Thailand’s sustainable stock in the long run. The long-run GPR only affects the return of Indonesian sustainable stock. All sustainable stocks are negatively affected by the VIX and positively affected by GD in the short and long run. Additionally, long-run WTI negatively affects the return of Indonesia’s sustainable stocks. Our findings contribute to rational investment decisions on sustainable stocks, including gold and crude oil prices, to hedge the asymmetric effect of uncertainty.

Hedging price risk through commodity derivatives: a case of Sethi Jewellers

Learning outcomes After completion of the case study, the students will be able to understand the different risks associated with a business, focusing on price risk and the importance of price risk management in business; understand and evaluate the products available for hedging price risk through exchange-traded derivatives in the Indian scenario; and understand and evaluate the different strategies for price risk management through exchange-traded derivatives in the Indian scenario. Case overview/synopsis The case study pertains to a small business, M/s Sethi Jewellers. The enterprise is being run by Shri Charan Jeet Sethi and his son Tejinder Sethi. The business is located in Jain Bazar, Jammu, UT, in Northern India. The business was started in 1972 by Charan Jeet’s father. They deal in a wide range of jewelry products and are well-established jewelers known for selling quality ornaments. Tejinder (MBA in marketing) was instrumental in revamping his business recently. Under his leadership, the business has experienced rapid transformation. The business has grown from a one-room shop fully managed by Tejinder’s grandfather to a multistory showroom with several artisans, sales staff and security persons. Through his e-store, Tejinder has a bulk order from a client where the client requires him to accept the order with a small token at the current price and deliver the final product three months from now. Tejinder is in a dilemma about accepting or rejecting the large order. Second, if he accepts, should he buy the entire gold now or wait to buy it later at a lower price? He is also considering hedging the price risk through exchange-traded derivatives. However, he is not entirely sure, as he has a few apprehensions regarding the same, and he is also not fully aware of the process and the instruments he has to use for hedging the price risk on the exchange. Complexity academic level The case study is aimed to cater to undergraduate, postgraduate and MBA students in the field of finance. This case study can be used for students interested in commodity derivatives, risk management and market microstructure. Supplementary materials Teaching notes are available for educators only. Subject code CSS 1: Accounting and finance.

Risk-constrained bidding and offering strategy for sector-coupled electricity-hydrogen systems incorporating accessibility level of mobility sector

To enhance the economic viability of integrated energy systems, it is important to balance risk and reward while ensuring operational flexibility and compliance with regulatory constraints. Developing an integrated risk measurement method for energy trading in energy markets that complies with regulatory constraints adds another layer of complexity, especially when dealing with large-scale heterogeneous energy systems, such as those dominated by green hydrogen. Ensuring adherence to market regulations, grid codes, and flexible requirements requires a thorough understanding of legal frameworks and policy considerations, as well as integrating regulatory constraints into the bidding/offering strategies. To address these challenges and enable the profitable development of integrated electricity-hydrogen energy systems (IEHSs), this paper develops a risk-constrained bidding/offering self-scheduling strategy for IEHSs that allows for simultaneous trading in day-ahead energy and reserve electricity markets. The developed self-scheduling strategy regulates hydrogen and power flow in a centralized manner, taking into account the operational limits of the power sector, hydrogen fueling stations (HFSs), electric vehicle parking lots, fuel cell vehicle parking lots, and renewable energy sources. As a salient feature, the important human-related factors in the mobility sector are included in the proposed strategy to motivate private owners to collaborate with IEHSs and to accommodate the charging demand of vehicles with electricity market signals. To obtain the robust day-ahead schedule, economic risks associated with renewable power generation, calls for reserve deployment, and electricity market prices are taken into consideration. Towards this end, a stochastic adaptive robust optimization approach is proposed to control the risk of profit variability, which is solved by a nested column-and-constraint generation algorithm. The effectiveness and feasibility of the proposed strategy are verified using the modified IEEE 14-bus test system, as a standard scale of local IEHSs. The numerical results highlight the synergies impact between HFSs and the power sector, resulting in an increase in the profit of the IEHS from $101.654k to $275.078k. Furthermore, the IEHS can improve its profit margin and competitiveness by employing the tri-level stochastic adaptive robust optimization approach. This approach ensures that the IEHS is resistant to sudden changes in real-time interactions, even with an 8.14% increase in the imbalance cost.

Modern Concepts of Market Power in Competition Law Doctrine: Russian and Some Foreign Jurisdictions Cases

In the doctrine of competition law, the approach is generally accepted, according to which the main criterion for the market power of an economic entity is the size of the market share. This criterion is questioned when it comes to the need to determine the market power of the economic entity — the owner of the digital platform. In this regard, it became necessary to develop new criteria for market power in relation to owners of digital platforms.In a number of foreign countries, the procedures for amending antitrust laws have been initiated or have already been completed, which are aimed at resolving new approaches to the market power of digital platform companies.The article proposes an analysis of both traditional and new concepts of market power, which are reflected in the legislation of a number of foreign countries. The key differences between modern concepts of market power and the concept of the dominant position of an economic entity in the commodity market are considered

Pricing strategies related to modern consumer psychology

In the market economy, commodity prices form the market trend, and their adjustment is the priority of every company. It has become an inevitable choice for companies to set prices independently based on market conditions and consumer preferences. The price psychology of modern consumers is an important factor that cannot be ignored in realizing the market value of a company’s products, it is directly related to the level of market share and profitability, and it involves the vital interests of all parts of the industrial chain. The aim of this article is to enhance the understanding of the impact of the market economy on price formation and modern consumer psychology. This objective is achieved through a combination of theoretical exploration and empirical research, providing a comprehensive perspective on the subject under discussion. this article highlighted the significance of commodity prices in shaping market trends and emphasized the necessity for companies to adapt pricing strategies based on market conditions and consumer preferences. The interplay of commodity prices and market trends within a competitive economy underlines strategic imperatives for businesses.

Winimaku ara papa wiimatjaraku and other stories

AbstractThis audio‐visual essay invites readers to enter a new intermedial archive of documentary paintings and stories by a celebrated and prolific multilingual Central Australian Aboriginal woman artist. Addressing our written text to intimate family and audiences from elsewhere, in multiple voices and modes of address, we offer an opportunity to consider the dynamics of creating, keeping and caring for memory through the affordances of digital co‐creativity. These include what we term ‘painting remix animation’, a form of what co‐author Rosalyn Boko calls mixamilani (‘mixing together’ of different elements). Guided by the artist's vibrant palette and life‐expressive practice, visitors to the article can move and rest amongst a variety of standpoints through which to attune to questions of history, memory, pictorial storytelling, love, friendship and joy. We hope that in this way, everyone can sense the world‐making powers and poetics of colour and understand how our style of slow research towards digital mixamilani creates a new kind of archive for holding paintings carefully, outside of the art commodity market.

Marketing of agricultural products through e-NAM in Tamil Nadu state

Integrating technology in agricultural marketing has marked a transformative milestone in Tamil Nadu, where agriculture is a cornerstone of the economy. The National Agriculture Market (e-NAM) has redefined traditional methods, creating a unified national market for agricultural commodities. This study focuses on marketing selected agricultural products through e-NAM in Tamil Nadu, analyzing trade records from 2017 to 2021, and forecasting up to 2025-2026. Focusing on efficiency and transparency, the study explores the impact of e-NAM on the agricultural trade market. Secondary data spanning 2017-2021 from the Department of Agriculture, Cooperation & Farmers Welfare, and the National Agricultural Market were collected and analyzed using charts and forecasting methods. Trade records for arrived and traded lots, quantities, and values in Tamil Nadu displayed consistent growth. The arrival of lots increased steadily, reflecting potential market expansion. Traded lots and quantities showcased dynamic growth, indicating an expanding trade market. Forecasted values predict a positive trajectory with continuous growth up to 2025-2026. The study underscores the transformative impact of e-NAM in Tamil Nadu. The positive trade quantity and value trends reveal a dynamic and expanding market. Forecasted projections suggest sustained growth, emphasizing the role of the platform in enhancing market efficiency and economic development. While optimistic, acknowledging external factors is crucial for stakeholders to navigate potential challenges. The success of e-NAM exemplifies technologies transformative power in fostering sustainable development in the Tamil Nadu agrarian sector.

Hybrid DE-Optimized GPR and NARX/SVR Models for Forecasting Gold Spot Prices: A Case Study of the Global Commodities Market

In this work, we highlight three different techniques for automatically constructing the dataset for a time-series study: the direct multi-step, the recursive multi-step, and the direct–recursive hybrid scheme. The nonlinear autoregressive with exogenous variable support vector regression (NARX SVR) and the Gaussian process regression (GPR), combined with the differential evolution (DE) for parameter tuning, are the two novel hybrid methods used in this study. The hyper-parameter settings used in the GPR and SVR training processes as part of this optimization technique DE significantly affect how accurate the regression is. The accuracy in the prediction of DE/GPR and DE/SVR, with or without NARX, is examined in this article using data on spot gold prices from the New York Commodities Exchange (COMEX) that have been made publicly available. According to RMSE statistics, the numerical results obtained demonstrate that NARX DE/SVR achieved the best results.

The Impact of Oil Shocks on Systemic Risk of the Commodity Markets

The Impact of Oil Shocks on Systemic Risk of the Commodity Markets

Exploring the dynamic links, implications for hedging and investment strategies between Sukuk and commodity market volatility: Evidence from country level analysis

This research paper examines the influence of spillovers between volatility of commodities (including soft commodities, precious metals, industrial metals, along with energy) and returns of sukuk. Using a notable sample of fifteen sukuk country indices and sixteen products, we examine the time-varying criterion vector autoregression (TVP-VAR) based extended joint connectedness method and contribute to the correlation analysis literature by supplying a comprehensive as well as policy-oriented analysis of the connection between sukuks and also commodities. Our results disclose that the system-wide dynamic connectedness is slowly heterogeneous and driven by financial occasions. Next, we look at the potential determinants of connectivity between sukuk and commodity markets, we find that global risk factors significantly impact the degree of spillovers between markets. In particular, the negative impacts of risk factors on spillovers suggest that some risk-mitigating properties may be related to market leverage in the composite portfolio in bear market conditions. In addition, our results, using hedging efficiency and the Sharpe ratio, confirm the hypothesis of diversification opportunities between markets that leverage dynamic connectivity networks.

Platinum and palladium price forecasting through neural networks

To many commodity market participants, forecasts of price series represent a critical task. In this work, nonlinear autoregressive neural network models’ potential is explored for forecasting daily prices series of platinum and palladium over about a fifty-year period. For this purpose, one hundred and twenty model settings are examined, including different training algorithms, numbers of hidden neurons and delays, and ratios used to segment the data. With the analysis, two models leading to stable and accurate forecast results are constructed for the prices of the two commodities. In particular, the models’ performance in terms of the relative root mean square error is 1.86% and 3.61% for platinum and palladium, respectively, for the overall sample. Results in this work could help technical forecasts and policy analysis. The forecast framework might be extended to other different commodities.

ANALISIS PERBANDINGAN METODE ARIMA DAN LEAST SQUARE UNTUK PREDIKSI HARGA EMAS : PENDEKATAN PROBABILISTIK DAN STATISTIK

Gold, a precious metal renowned for its value in various sectors, including investment and jewelry, is often considered a secure asset within investment portfolios. However, its prices exhibit high volatility influenced by economic, geopolitical, and global financial factors. Previous research has focused on predictive methods to anticipate gold price movements. In recent years, heightened complexity and uncertainty, exacerbated by global factors such as economic shifts and the Covid-19 pandemic, emphasizes the urgency of accurate gold price predictions. This study comprehensively analyzes and compares the performance of Autoregressive Integrated Moving Average (ARIMA) and Ordinary Least Squares (OLS) in forecasting gold prices, utilizing statistical and probabilistic approaches. ARIMA excels in handling time series data, identifying complex patterns, and forecasting price changes based on historical trends. Conversely, OLS, a probabilistic method, stands out in adjusting linear models to gold price data, providing detailed insights into influencing factors. The research employs a 5-year gold price dataset (2018-2023) and evaluates the models' performance using Mean Squared Error (MSE) and Mean Absolute Percentage Error (MAPE). Results indicate OLS outperforms ARIMA, with lower MSE (45.79 vs. 284.83) and MAPE (0.0026 vs. 0.0066). This study contributes nuanced insights for market participants, investors, and researchers to comprehend commodity market behaviour, particularly in gold, emphasizing the importance of accurate prediction methods in strategic decision-making.

Commodity Market Efficiency: New Evidence From the Russia-Ukraine War

We re-evaluate the efficiency of selected commodity markets during the Russia-Ukraine crisis using the asymptotic normal variance ratio test. We find that there is a substantial difference in the commodity prices before and after the war’s commencement. We also show that the markets are weak-form inefficient before and after the invasion except for gasoline and oats which became efficient during the war. We highlight the investment implications of the findings.