Most traded Commodities in The World: Commodities are the basic essential materials of a good economy from which other by-products are manufactured. Here we shall discuss the most traded commodities in the world with their importance, impact on economics and factors affecting their prices globally. Commodity markets are highly risky with their high volatility and traders with good risk management can be profitable in the long run.

What are Commodities?

Commodities are naturally occurring materials which are collected and processed for further use in the day the day usage. The raw materials such as oil and natural gas, sugar, agricultural products, metals, etc.., are required for the production of energy, food, clothing and other required products, that forms the basis of a globally growing economy.

The mass-produced commodities are standardised for quality and quantity and bought and sold at different prices for different commodities on exchanges.

Commodities are of two types: Hard and Soft commodities in which the prices are highly volatile with their risks involved. Traders can find profitable opportunities on both buy and sell side.

Note: If you want to learn Candlesticks and Chart Trading from Scratch, here’s the best book available on Amazon! Get the book now!

telegram channel

The price of the security is affected by various factors like consumer trends, weather, infrastructure, government policies, economic outlook, currency and reserve levels, etc… 

Most Traded Commodities in the World Are:-

Most Traded Commodities in the World #1 – Brent Crude oil

Crude oil is the world’s most in-demand commodity from which products like petrol, diesel, lubricants and many other petrochemicals are refined. It is a high-quality sweet light oil because of low sulphur and low density and hence it is easy to refine to the end products. It is sourced from oil fields in the North Sea, Oseberg, Forties and Ekosfisk fields, off the shores of the UK and Norway. 

The price of Brent crude oil depends on supply and demand factors where the demand for crude oil is linked with global economic performance. Prices generally fall when the Demand from Oil refineries reduce or Oil Filelds produce more. Prices tend to Rise when the Demand from Oil Refineries Increase and Oil field production remains stable or Reduces. Of course, various factors contribute to the Rise and fall in Prodcution and supply.

Most Traded Commodities in the World #2 – Crude oil WTI(West Texas Intermediate)

West Texas Intermediate crude oil is a specific grade of crude oil which is sweet light oil because it contains sulphur between 0.24% to 0.34% and has a low density. It is sourced from various US states including Texas, Louisiana and North Dakota and through the pipeline it reaches the Midwest and Gulf of Mexico to get refined and sent to Cushing, Oklahoma for price settlement.

In the past, it was difficult to transport oil internationally because Cushing was a landlocked area. However, the recent improvements in the seaway pipeline have made it easier for export which has generally seen prices closely competing with Brent crude oil.

Most Traded Commodities in the World #3 – Gold

Gold is a precious metal which is highly malleable compared to all other metals. It is primarily used for jewellery production, as an asset for investment and also a small amount is used in industries as it conducts electricity and is resistant to chemical reactions.  The majority of gold is mined in China, Australia, Russia and the United States.

As Gold is widely considered to be a safe asset, it tends to hold its value or rise in times of political and economic uncertainty. So many traders pump money into gold when the dollar value is falling as gold often has an inverse relationship with the dollar and along with it many other factors influence the gold price.

Most Traded Commodities in the World #4 – Soybeans 

Soybeans are the most popular and important agricultural commodity which is rich in protein and relatively feasible to produce. It is majorly grown in the US, Brazil, Argentina, China and India. It is used to make a variety of food products, and agricultural products and also be used to produce biodiesel. 

Soybean prices are gradually affected by the demand for animal feed, biodiesel, meat, and dairy substitutes and also by unusual weather conditions.

As the US is a major producer of soybeans the prices can also be influenced by the strength of the US dollar index.

Most Traded Commodities in the World #5 – Corn

Corn also known as maize is an important agricultural commodity used primarily to produce animal feed, ethanol, corn syrup and starch. The majority of corn grows in the US, China, Brazil and Argentina.

Same to soybeans, the price of corn also is highly dependent on the demand for animal feed and biofuels, also the US dollar and weather conditions. 

Agricultural subsidies by states and strong incentives for corn production help maintain global supplies.

Most Traded Commodities in the World #6 – Silver

Silver is the precious metal commodity traded which has high demand like gold with 50% of the demand for silver associated with industrial uses like solar panels, photographic films and electrical devices.

Similar to gold, a large amount of silver is also attracted by jewellers and investors as a valued asset.

As silver is also considered a safe and value of asset its prices are gradually affected during times of economic uncertainty. The supply of silver is most often extracted from the ores of other metals so fluctuations in demand of other elements influence the effect of silver prices. However, gold is considered a more reliable investment as its price is less dependent on industrial usage demand.

Most Traded Commodities in the World #7 – Copper

Copper is an important metal as it is a good conductor of both heat and electricity also it is corrosion-resistant and weatherproof. It is used to manufacture electrical wires, pipes, and industry machinery and also to produce brass and alloys including brass and bronze. Copper is mined in Chile, China, Peru and the US.

As it is mainly used in industry and electronics, the price of copper can fluctuate significantly with economic outcomes and supply can be affected based on trade disputes and infrastructure concerns.

Most Traded Commodities in the World #8 – Iron ore

Iron ores are the minerals from which iron is extracted, it is used to produce pig iron which is again used in steel production.

The extracted iron is also used to produce cast iron, magnets and catalysts for various industrial and chemical uses.

Iron is relatively easy to mine and historically the price has been relatively stable with normally sufficient supply to meet demand. Since 2000 there have been significant fluctuations in price due to economic growth and rapid urbanization requiring enormous amounts of steel.

Most Traded Commodities in the World #9 – Coffee

 In agricultural commodities, coffee is among the most globally traded and consumed commodity that comes from the beans of coffee plants. It’s one of the most popular beverages worldwide which plays a significant role in various cultures. The coffee market is of various types including Arabica and Robusta which have become more fashionable drinks with the number of increasing coffee houses.

The influenced factors such as weather conditions, supply and demand, and geopolitical events may affect the prices which can be volatile and affect coffee producers and consumers.

Most Traded Commodities in the World #10 – Sugar

Raw sugar which refers to the sugar commodity is a key ingredient in various food products which is consumed heavily and has become one of the most traded commodities in the world.

Sugar harvested from sugarcane and sugar beet is largely produced in Brazil, India and European Union and grown mainly in China Thailand, Brazil and India. As sugar is globally popular, its prices are determined not just by production but also by the manufacturing of sugar products by different companies.

The prices on global markets are affected by factors like weather conditions, supply and demand, geopolitical events, and government policies. 

In Closing

With a growing economy, the demand for commodities increases from time to time, as the above-listed most traded commodities have been firmly established as the biggest markets with the most liquidity and are commonly traded worldwide.

The prices of commodities are widely influenced by factors like weather conditions, supply and demand, geopolitical events, currencies and government policies. 

Written By Deepak M

By utilizing the stock screener, stock heatmap, portfolio backtesting, and stock compare tool on the Trade Brains portal, investors gain access to comprehensive tools that enable them to identify the best stocks also get updated with stock market news, and make well-informed investment decisions.


Start Your Stock Market Journey Today!

Want to learn Stock Market trading and Investing? Make sure to check out exclusive Stock Market courses by FinGrad, the learning initiative by Trade Brains. You can enroll in FREE courses and webinars available on FinGrad today and get ahead in your trading career. Join now!!