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Introduction of Commodity Market , History

A commodity market is a market where raw materials or primary products are bought and sold. These raw materials or primary products include agricultural products like wheat, corn, and soybeans, as well as metals like gold, silver, and copper, and energy products like crude oil and natural gas.

The history of commodity trading can be traced back to ancient civilizations, where farmers and merchants would barter their goods in local markets. With the expansion of trade and commerce, goods began to be traded over longer distances, leading to the development of organized commodity markets.

In the modern era, commodity trading began to take shape in the 19th century with the advent of futures contracts. Futures contracts allowed farmers and other producers to hedge against price fluctuations and lock in prices for their goods, while buyers could use futures contracts to secure future supplies at a fixed price.

In the United States, the Chicago Board of Trade (CBOT) was established in 1848 as a platform for trading agricultural commodities, and the Chicago Mercantile Exchange (CME) was founded in 1898 as a marketplace for futures contracts on a range of commodities.

Today, commodity markets are an important component of global financial markets, providing a platform for producers and consumers to manage their risk and for traders and investors to speculate on price movements. The major commodity exchanges around the world include the New York Mercantile Exchange (NYMEX), the Intercontinental Exchange (ICE), the London Metal Exchange (LME), and the Shanghai Futures Exchange (SHFE), among others.