Does Speculation of Futures of Food Commodities impact the Food Prices?
I am investigating whether the speculation of futures for Food Commodities has an impact on the food prices. I will be doing this through investigating whether the volatility in the futures of Food Commodities cause volatility of its underlying spot price.
Motivation is to show the speculation, which is secondary markets beings used as gambling casinos, has negative externalities on society. In particular food prices. Which is why, the futures and spot prices for – wheat, corn, sugar will be used.
I need a good quality literature review showing that forces beyond supply and demand, are in place for the prices of futures, in this case speculation.
Literature Review – what is been written so far on this.
I will upload files – with more details.
For example – financialization of commodities.
I need a Literature Review – which shows that my disseration will contribute, in the sense it will show it has an impact on food prices, via the volatility caused by speculation on its underlying spot prices – for food. Therfore, impact food prices.
Wheat, Corn and Sugar is found in nearly every food product in the supermarket. Nutritionists say walking down the aisle of a supermarket is like walking down a corn field.
Good to show how trading strategies in speculation, cause prices to rise. Trading strategies where if the price if rising, it is predicted the price will rise higher, they buy then sell. I hope this is understood – as I require more detailed explanation in this.
What is Speculation? vs the purpose of futures, and the existance of the secondary market- risk, liquidity – (just briefly touch on this)
WHat is Finanicialisation? (again brief)
How does it cause volatility? (breif)_
Main = literature review on specualtion of futures affecting prices. For example there is a paper (will upload), how speculation in oil commodities affect food prices.
I will also upload the methodology, it is of any help. Usually in Literature Review it is not.