The largest classification of commodities traded on national and international commodity exchanges is that of agricultural commodities. Agricultural commodities are commodities that have their origins on farms and plantations, and are either primary products, or products that have undergone minimal processing, such as freezing, cleaning or portioning into cuts. Some agricultural commodities can also be referred to as soft commodities: this refers to the fact that they are grown rather than mined. Some traders, however, do not refer to meat commodities as soft commodities, even though they have been farmed, preferring to classify them differently.
Grain commodities are the foundation of commodity trading, being among the first commodities to be traded when the modern system was set up. The primary commodities of this group are wheat, corn, oats, barley and rough rice. These are traded on most of the world’s major exchanges, and are traded in contracts of 5000 bu (bushels), save for rough rice which is traded in contacts of 2000 cwt (hundredweight). Pulses are also a part of this classification, examples being soybeans and its derivatives soybean meal and soybeal oil, traded in 5000 bu, 1000 short tons and 60000 lb (pounds) respectively.
Though some meat commodities involve the trading of live animals, a proportion do not, and the advancement of food freezing technology has led to an increase in their trading in recent decades. Frozen pork bellies (traded in 40000 lb contracts) are an example of this, being a staple of the commodity trading system. Other meat commodities are live cattle, feeder cattle and lean hogs. All but the second of these also trade in 40000 lb contracts; feeder cattle trades in 50000 lb contracts.
Dairy commodities have been in existence since the 19th century, when exchanges like the Chicago Butter and Egg Board were created. Cheese, butter, milk and whey are all traded on the commodity market, with the solid versions of these usually traded in 40000 lb carloads.
Lumber is an important commodity traded on many international commodity exchanges. Random length lumber is the primary lumber commodity: despite the advance of modern building techniques, wood is still a key building material. Random length lumber is traded in contracts based on board feet (110000 board feet is the standard contract on the Chicago Mercantile Exchange). Softwood pulp and hardwood pulp are also traded as commodities.
Popular soft commodities include coffee, sugar and cocoa. Coffee as a commodity may be split into a number of sub-types, including Arabica and Robusta. Sugar may be similarly divided, with sugar no. 11 and sugar no. 14 both being traded. Contract sizes differ depending on the market where the commodity is being traded, but all are traded in lbs.
There are a number of agricultural commodities that resist easy classification. These include wool, canola, rubber, palm oil, and cotton. These commodities are traded on exchanges across the world, with some being more heavily traded in a particular exchange (an example being rubber, for which the main centre is the Singapore Commodity Exchange).