International Commodity
Exchanges. auction
• The United States, Japan, United Kingdom, Brazil, Australia,
Singapore are homes to leading commodity futures exchanges
in the world.
• commodity exchange the primary role is to provide
transparency and liquidity in its contracts to its members,
clients and market participants like farmers, corporate, small
business men, financial service providers, international trading
firms and speculators for price delivery, risk management and
investment.
Worlds Major Commodity Exchanges:
• 1. The New York Mercantile Exchange (NYMEX)
• The New York Mercantile Exchange is the world’s biggest exchange
for trading in physical commodity futures.
• Commodities traded – Light Sweet Crude Oil, Natural gas, Heating
Oil, Gasoline, Electricity, Propane, Gold, Silver, Copper, Aluminum,
Platinum, Palladium, etc.
• 2. London Metal Exchange (LME)
• The Exchange was formed in 1877 as a direct consequence of the
industrial revolution witnessed in Britain in the 19th Century. The
exchange trades 24 hours a day.
• Commodities Traded – Aluminum, Copper, Nickel, Lead, Tin, Zinc,
Aluminum Alloy, North American Special Aluminum Alloy (NASAAC),
Polypropylene, Linear Low Density Polyethylene, etc.
• 3. The Chicago Board of Trade (CBOT)
• The first commodity exchange established on the world was the
Chicago Board of Trade (CBOT). During the year 1848 by a group of
Chicago merchants who were keen to establish a central market
place for trade.
• Commodities traded Corn, Soybeans, Soybean Oil, Soybean Meal,
Wheat, Oats, Ethanol, Rough Rice, Gold, and Silver etc.
• 4. Tokyo Commodity Exchange (TOCOM)
• The Tokyo Commodity Exchange (TOCOM) is the second largest
commodity futures exchange in the world. It has made rapid
advancements in commodity trading globally since inception 20 years
back.
• Commodities Traded. Gasoline, Kerosene, Crude Oil, Gold, Silver,
Platinum, Palladium, Aluminum, Rubber, Etc.
• 5. Chicago Mercantile Exchange (CME)
• Chicago Mercantile Exchange (CME) is the largest futures exchange in
the US and the largest futures clearing house in the world for futures
and options trading. Formed in 1898 primarily to trade in agricultural
commodities.
• Commodities Traded. Butter, Milk, Diammonium Phosphate, Feeder
cattle, Frozen Pork bellies, Lean Hogs, live Cattle, Non-fat Dry Milk,
Urea, Urea Ammonium Nitrate, Etc.
auction
• An auction is a process of buying and selling goods or services by
offering them up for bid, taking bids, and then selling the item to the
highest bidder. In economic theory, an auction may refer to any
mechanism or set of trading rules for exchange.
•
When a certain item is sold in public through competitive bidding by
the buyers, it is known as an auction. This term was derived out of
the word augeo, which is Latin for 'to increase'. There are different
types of auctions. Discussed below are the various kinds of auction a
seller can choose from.
Depending on the Method of Conduction
• » English Auction
Also known as an open ascending price auction, this method is highly
used for selling real estate, antique items, paintings. participants
write their bids on a sheet of paper placed beside the item to be
sold. The person writing the highest bid takes the item along.
• » Multi-par Auction
Land, farms, timberland, etc., are generally sold through this method.
Auctioneer may choose to derive profit by selling portions of land to
multiple buyers.
• » Sealed First-price Auction
This method gives the seller an option to secretly study the bids and
decide along with the auctioneer the best deal for the item.
Government contracts, tenders, etc., are usually issued using this
method.
• » Dutch Auction
Items which can easily perish, like fish and other eatables, are
sometimes sold by this method. Here, the auctioneer announces an
extremely high bid which is subsequently lowered till a participant
agrees to pay a particular bid. It is not widely used for the purpose of
auctioning.
• » Online Auction
The Internet is now used for auctioning several products and
services. Details of products and their images are available on the
auction website.
•
» Catalog Auction
When it is not feasible to gather the items for sale at a single place,
simply because all are scattered in different locations, this method is
used. A catalog containing list of goods to be auctioned is available
there for the bidders.
• Auctioning is frequently done for real estate, antique items, livestock,
businesses, cars, holiday packages, etc. Each method mentioned
above is different in terms of time required for conduction and
pricing.
•Thank you!!! 