New types of non-trade related participation in commodity futures markets

This paper explores the growing involvement of new types of non- commodity-sector-related players in commodity futures markets. This includes a discussion on the role of managed funds, the impact of the use of commodity warrants, and the direct involvement of banks. The impact of this new form of "speculation" on the price formation process on commodity futures markets is then examined, and conclusions are drawn as to the use of these markets by commodity sector actors.commodity futures market, futures, options, speculation, market efficiency

Farmers and farmers’ associations in developing countries and their use of modern financial instruments

This paper starts with an overview of the current literature on the cost of price risk exposure to developing country farmers. It then discusses market-based price risk management instruments (such as futures and options) that can be used by farmers, as well as various mechanisms through which farmers' associations can facilitate farmers' access to price risk management tools as well as lower-cost financing (using warehouse receipt finance, repos and other structured financings). The experiences with use of such modern financial tools by farmers in several developing countries (Brazil, Colombia, Guatemala, India, Malaysia, Mexico, Philippines, Uganda) are described. The report concludes with a discussion of the practicalities of farmers' associations starting to use such financial instruments, including the potential of new technologies such as smart cards.farmers structured finance warehouse receipts price risk management

Potential applications of structured commodity financing techniques for banks in developing countries

This paper discusses of a number of innovative financial techniques that can be used by developing country banks to open up new financing possibilities in the commodities sector, for industries servicing the commodity sector, and for financing on the basis of "commoditized" income streams. This includes techniques such as factoring and forfaiting, countertrade, warehouse receipt finance, prepayments, export receivables finance, Islamic finance, structured import finance, and securitization. A number of practical models for developing country banks are described.agricultural finance structured finance repos banks securitization

The feasibility of an international tropical plywood futures contract

This paper explores the potential for futures contracts in tropical (hardwood) plywood, one of the few major internationally traded commodities for which there is no yet a futures market. Commodity characteristics and market structures and practices that have an impact on the feasibility of a futures market are examined in detail, and conclusions drawn as to the way forward if one wishes to create such a market.commodity futures market, plywood

The effectiveness and usefulness for commodity-dependent countries of new tools in commodity markets: risk management and collateralized finance

This paper describes the experiences of developing country enterprises, farmers and governments with commodity price risk management and various forms of structured finance. It explores the constraints that these entities face in using modern financial markets, including counterparty and sovereign risk obstacles, and problems in their legal and regulatory framework. Various schemes to overcome such obstacles are examined.commodity futures market, futures, options, risk management, structured finance, warehouse receipts, securitization