Agricultural futures contracts are agreements to buy or sell a certain amount of a product in the future according to the specified time, place of delivery and quality of the product.  The underlying value of these contracts is tied to the agricultural commodities.  Typically, sellers (i.e. farmers) are concerned about commodity prices falling; buyers (i.e. wool, cotton or wheat buyers) are worried about prices rising.  By either buying or selling agricultural futures contracts, both parties have the opportunity of locking into a future price.

Advantages of trading Agriculture Futures:

• Hedging against declining crop prices without foregoing the opportunity to profit if prices increase
• Opportunities to achieve your investment objectives amidst different market scenarios – rising prices, falling prices, or stable prices