Commodity futures markets: are they an effective price risk management tool for the European wheat supply chain ?

The instability of commodity prices and the hypothesis that speculative behaviour was one of its causes has brought renewed interest in futures markets. In this paper, we analyse the European wheat futures markets (feed and milling) and the CBOT’s wheat contract as a comparison, to study their efficiency, hedging effectiveness and whether they were affected during the period of high instability after 2007. Implicitly this is a test of whether the increasing presence of speculation in futures markets have made them divorced from the physical markets, and therefore, not useful for commercial entities aiming to exchange price risk for basis risk.


Issue Date:
2013-06
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/149773
Total Pages:
19
JEL Codes:
G1; G130




 Record created 2017-04-01, last modified 2017-08-27

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