The presentation is covering the whole North America Commodity Market.

1. COMMODITY MARKETS
IN NORTH AMERICA

2. COMMODITY MARKET
Commodity market is a place where trading in
commodities takes place. It is similar to an Equity
market, but instead of buying or selling shares
one buys or sells commodities.
Commodity markets began with the trading of
agricultural products, such as wheat, corn, cattle,
etc. in the 19th century.

3. COMMODITY EXCHANGE
An entity, usually an incorporated association,
that determines and enforces rules and
procedures for the trading of commodities and
related investments, such as commodity futures.
Commodities exchange also refers to the physical
center where trading takes place.

4. COMMODITY EXCHANGES
IN UNITED STATES

6. HISTORY
In 1872, a group of Manhattan Diary Merchants
formed the Butter and Cheese Exchange.
Subsequently, egg traders joined and the
exchange was renamed as Butter, Cheese and
Egg Exchange.

7. In 1933, the Commodity Exchange(COMEX)was
established through the merger of four small
exchanges — the National Metal Exchange, the
Rubber Exchange of New York, the National Raw
Silk Exchange, and the New York Hide Exchange.

8. On August 3, 1994, New York’s two largest
exchanges, the New York Mercantile Exchange
and the Commodity Exchange, merged to
become the world’s largest physical commodity
futures exchange.
It is regulated by the Commodities Futures
Trading Commission, an agency of the US
government.

10. COMMODITIES TRADED
(NYMEX Division)
Energy products
Crude Oil
Heating Oil
Gasoline
Natural Gas
Electricity
Propane

12. COMEX DIVISION
Gold
Silver
Copper
Aluminium
Platinum

14. CHICAGO MERCANTILE
EXCHANGE (CME)
The Chicago Mercantile Exchange (CME)
(often called "the Chicago Merc", or "the
Merc") is an American financial and commodity
derivative exchange based in Chicago and
located at 20 S. Wacker Drive.
The CME was founded in 1898 as the Chicago
Butter and Egg Board, an agricultural
commodities exchange.

15. Originally, the exchange was a non-profit
organization. The Merc demutualized in
November 2000, went public in December
2002, and merged with the Chicago Board
of Trade in July 2007 to become a
designated contract market of the CME
Group Inc., which operates both markets.
The chief executive officer of CME Group is
Phupinder Gill, Terrence A. Duffy is the
president and executive chairman of the
board, and Leo Melamed is chairman
emeritus.

16. CONT….
On August 18, 2008, shareholders approved a
merger with the New York Mercantile
Exchange (NYMEX) and COMEX. The Merc,
CBOT, NYMEX and COMEX are now markets
owned by the CME Group.
Today, the Merc trades several types of
financial instruments: interest rates, equities,
currencies, and commodities.

17. It also offers trading in alternative
investments, such as weather and real
estate derivatives, and has the largest
options and futures contracts open
interest (number of contracts outstanding)
of any futures exchange in the world.
Trading is conducted in two methods; an
open outcry format and the CME Globex
electronic trading platform.
Approximately 80 percent of total volume
at the exchange occurs electronically on
CME Globex.

18. COMMODITIES
 Agriculture commodity contracts include :
1. Live cattle.
2. Lean hogs.
3. Feeder cattle.
4. Class iv milk.
5. Frozen pork bellies.
6. International Skimmed Milk Powder (ISM).
7. Nonfat Dry Milk.
8. Cash-Settled Butter.
9. Butter, Random Length Lumber, Softwood
Pulp, Hardwood Pulp etc.

19. CHICAGO BOARD OF
TRADE (CBT)
The Chicago Board of Trade (CBOT),
established in 1848, is the world's oldest
futures and options exchange.
More than 50 different options and futures
contracts are traded by over 3,600 CBOT
members through open outcry and electronic
trading.
Volumes at the exchange in 2003 were a
record breaking 454 million contracts.

20. CONTD…
On 12 July 2007, the CBOT merged with the
Chicago Mercantile Exchange (CME) to form the
CME Group, a CME/Chicago Board of Trade
Company.
CBOT and three other exchanges (CME, NYMEX,
and COMEX) now operate as designated contract
markets (DCM) of the CME Group.
The concerns of U.S. merchants to ensure that
there were buyers and sellers for commodities
have resulted into forward contracts to sell and
buy commodities. Still, credit risk remained a
serious problem.

21. CONTD…
In 1864, the CBOT listed the first ever
standardized "exchange traded" forward
contracts, which were called futures contracts.
In 1919, the Chicago Butter and Egg Board, a
spin-off of the CBOT, was reorganized to
enable member traders to allow future trading,
and its name was changed to Chicago
Mercantile Exchange (CME).
On October 19, 2005, the initial public offering
(IPO) of 3,191,489 CBOT shares was priced at
$54.00 (USD) per share.

22. CONTD…
On its first day of trading the stock closed up
+49% at $80.50 (USD) on the NYSE.
In 2007, the CBOT and the CME merged to form
the CME Group.
In 2012, the CBOT expanded electronic trading
hours to 22 hours per day to become more
competitive in the industry.
The open outcry hours remained the same.

23. COMMODITIES
AGRICULTURAL COMMODITIES(LIKE GRAIN &
OILSEED,LIVESTOCK,DAIRY).
ENERGY PRODUCTS (LIKE CRUDE
OIL,NATURAL GAS,REFINED
PRODUCTS,BIOFUELS,COAL,ELECTRICITY,EMI
SSIONS,FREIGHT,PETROCHEMICALS)

24. CONTD…
METALURGICAL COMMODITIES (LIKE PRECIOUS
METALS,BASE,FERROUS,COKING COAL,URANIUM
ETC.)

26. INTRODUCTION
 The Minneapolis Grain
Exchange (MGEX) was formed in 1881
in Minneapolis
Founded as the Minneapolis Chamber of
Commerce in 1881, the MGEX has been a
marketplace for producers, processors and
millers for more than 125 years.
The Minneapolis Chamber of Commerce
opened as a regional cash marketplace to
promote fair trade and to prevent trade
abuses in wheat, oats and corn.

27. In 1883, the Chamber of Commerce
introduced its first futures contract: Hard
Red Spring Wheat.
This contract was launched to address
price risk management needs
of buyers and sellers of spring wheat and
still trades today.
In 1947, the exchange was renamed the
Minneapolis Grain Exchange. Today the
exchange uses MGEX

28. MGEX has been the principal market
for Hard Red Spring Wheat (HRSW) since
1881
offering futures and options contracts
based on its unique commodity
 HRSW is one of the highest -
protein wheat
MGEX offers five financially settled
agricultural index products

29. MGEX offers five financially settled
agricultural index products:
1. Hard Red Spring Wheat Index (HRSI),
2. Hard Red Winter Wheat Index (HRWI),
3. Soft Red Winter Wheat Index (SRWI),
4. National Corn Index (NCI) and
5. National Soybean Index (NSI).

30. Hard Red Spring Wheat
Hard red spring wheat is one of the
highest protein wheat grown and is sought
by millers because of its high quality. It is
found in bagels, high quality breads and
cereals.

31. Wheat is the principal U.S. cereal grain for
export and domestic consumption.
There are several hundred varieties of
wheat produced in the United States
Wheat grown depends largely upon
rainfall, temperature, soil conditions and
tradition

32. DIFFERENT TYPES OF
WHEAT
HARD RED WINTER
HARD RED SPRING

33. SOFT RED WINTER
DURUM

34. HARD WHITE WHEAT
SOFT WHITE WHEAT

35. WINNIPEG COMMODITY
EXCHANGE

36. Winnipeg Commodity
Exchange
The Winnipeg Commodity Exchange is the
former name of a derivatives exchange based
in Winnipeg, Manitoba, Canada now known as ICE
Futures Canada. Futures and options contracts are
electronically traded in western barley and canola .
The WCE began its existence as the Winnipeg
Grain & Produce Exchange in 1887.
 In 1904, it introduced its first futures contracts. It
was, and remains, Canada's only commodity
futures exchange. It also formerly operated the
Canadian Financial Futures Market.

38. In December 2004, WCE converted from the
traditional “open outcry" method of trading to an
electronic trading format. This made it the first
commodity futures exchange in North America to
go fully electronic.
 Until December 2007, futures were traded on the
platform of the Chicago Board of Trade.
Winnipeg commodity exchange trades in feed
wheat, western barley, canola and flaxseed.

41. INTERCONTINENTAL
EXCHANGE
History of (ICE)
Jeffrey c sprecher
It offered

42. COMMODITIES TRADED
oil
Silver
Gold
Natural gas
Cotton
Platinum
soyabean

44. U.S.CFTC.

45. HISTORY OF U.S. CFTC.
Futures contracts for agricultural commodities
have been traded in the United States for more
than 150 years and have been under Federal
regulation since the 1920s. When the CFTC was
created in 1974 with the enactment of the
Commodity Futures Trading Commission Act, most
futures trading took place in the agricultural
sector. Over the years, the futures industry has
become increasingly varied and complex.
Significant dates in the history of futures
regulation before the creation of the CFTC and
significant dates in CFTC history from 1974 to the
present are given here.

46. ABOUT CFTC.
Founded – 1974
Acting Chairman – Mark Wetjen.
Branch Of Government – Executive.
Location – Washington D.C. , New York ,
Chicago , Kansas City.

47. CFTC ORGANISATION.
The CFTC organisation consists of the
Commissioners, the offices of the Chairman, and the
agency's operating units.
The Commission consists of five
Commissioners appointed by the President, with the
advice and consent of the Senate, to serve staggered
five-year terms. The President designates one of the
Commissioners to serve as Chairman. No more than
three Commissioners at any one time may be from
the same political party.

48. DIVISIONS
DCR (Division of Clearing and Risk.)
DOE (Division Of Enforcement.)
DMO (Division of Market Oversight.)
DSIO (Division of swap dealer and
intermediary operations.)

49. COMMITTEES
Agricultural Advisory committee.
Energy and environmental markets
advisory committee.
Global markets Advisory Committee.
Technology Advisory committee.
CFTC-SEC Joint Advisory Committee.

50. MISSION
The mission of the Commodity Futures
Trading Commission (CFTC) is to protect
market participants and the public from
fraud, manipulation, abusive practices and
systemic risk related to derivatives – both
futures and swaps – and to foster
transparent, open, competitive and
financially sound markets.
In carrying out this mission and to
promote market integrity, the Commission
polices the derivatives markets for various
abuses and works to ensure the protection
of customer funds.