Commodity Options
The right of choice to buy or sell a Commodity Options at a specified price within a fixed period of time by analogy with options to shares. In mid-1978. The COMMISSION ON FIXED-EXCHANGE TRANSACTIONS suspended trade, and soon they were prohibited by law
However, on 16 October 1978. The Commission announced the adoption of amendments to its provisions, the regulatory options, which allowed trade Commodity Options (the so-called dealer options) private individuals and firms that comply with their requirements. Subsequent amendments to the rules contain requirements on the financial statements as from the side of sellers dealer options, and from the wholesalers, offering and selling dealer options to the public. In June 1981, the question of permission options trading for certain commodities has become a subject of public hearings of the Commission.
After suspension of the Commission of the trading Commodity Options in mid-1978, and the subsequent legal provisions for the prohibition of the Division for the implementation of the laws in life filed a lawsuit against a wide variety of illegal and fraudulent over-the-counter operations with the goods in 1979 financial year.
Inventories of certain agricultural products have a pronounced seasonality and depends on weather conditions. For example, strong frosts in Argentina cause consequences of a world scale, when the exchange traders react to the possibility of reduction of demand in the market of coffee. However, not all of the markets of agricultural products are so dependent on the weather conditions. For example, the raw material for sugar are sugar beet and cane growing in various regions of the world. A hurricane in the West Indies will, of course, the price of sugar, but not so drastically, so as not affect the harvest of sugar beet in countries with a more moderate climate.
Another important factor affecting the price, is the activity of different trade organizations such as the international organization of the countries-manufacturers of coffee. Such organizations may set their members quotas for deliveries of the goods with the purpose of increase of the prices. Though the influence of these organizations in recent years has weakened, traders still respond to their official statements.
Important role, finally, play a government subsidies or over government bodies, especially within the European Community. These bodies often dictate artificial minimum prices for agricultural products.
