Agricultural futures are the oldest futures listed in the market. Over the years, agricultural futures have been one of the mainstream products in the international futures market. trading varieties. There are various types of products in agricultural futures, and agricultural futures have become the core of the related industrial chain in the world’s agricultural production, circulation and consumption.
AETOS provides popular agricultural futures contracts including corn, soybeans, wheat, cotton (No.2), Coffee C, sugar (No.11), cocoa, soybean oil and live cattle.
Cotton is known for its diverse usage, comfort and durability. Cotton has been widely used in weaving, clothing and household supplies raw materials due to its characteristics in intensity, color durability, washing durability and easiness in processing. China and USA are the biggest production countries of cotton. And, USA is the world's foremost exporter, and exercise much influence on the price of cotton.
The cotton market is highly globalized, with more than one-third of global cotton harvests shipped internationally every year. Cotton future is normally bought by textile mills for the purpose of hedging in order to avoid the risk of price volatility. The prices of cotton changes seasonally. The highest prices for cotton normally occur between March and July while the lowest prices typically occur between September and November.
- Weather conditions
changes in weather conditions will directly affect the crop yields
- Seasonal factors
Cyclical production of agricultural products affects the price of agricultural futures
- Cost-benefit of the produce
Cost-benefit situation will affect the decisions of production scale for the upcoming year among the producers
- Financial and monetary factors
Interest rates and exchange rate fluctuations often cause the fluctuations o n the quotes of commodity futures
- Government policies including import and export tariffs
Government Incentives will stimulate production and thus driving down the prices, and vice versa