I believe that the main reason is that there is a commodity market for the the ones that tend to fluctuate the most. It is the fact that there is a commodity market that makes them fluctuate. The market mechanism allows anyone to buy and sell commodities in an auction environment. The auction mechanism is governed by greed and fear. When greed is the driving force, prices tend to increase rapidly. When fear is the driving force, prices tend to decrease rapidly. In certain commodities such as agriculture prices can vary rapidly based on weather conditions. A dry spell in the mid west will drive up the price of corn and soy beans. A frost in Florida will send the price of Orange Juice through the roof. A bumper crop prediction will drive prices down. Financial markets can vary wildly based on world events such as Spain being in financial difficulty or a bank failing or even an increase in applications for unemployment.
Per Cassie Wilkerson:
The above is partial truth but elaborate a more realistic understanding about why commodities fluctuate is to recognize they are derived from resources that may be limited in nature perishable and non-perishable. Despite this each has limitations. The cost are semi- regulated for beneficial reason and manipulated due to adverse negative actions.
These commodities are restricted for either positive or negative consequences that cause this price fluctuation. Social, Economical, Environmental and Political.
Positive Examples:
There are negative consequences too noted:
Social Disobedience:
War- ensuing human peril
Unfair labor practices
Unfair trade agreements- politically, socially or monetary driven agenda
Panic or false- driven demand
Boycott -for social, political or economical reasons
Natural Disturbance:
Climate changes: damage by weather
Geographical: earthquakes, volcanoes
Monetary Restrictions:
Cost to extract resources higher then price obtained
Labor or limited production capital
Limited demand to produce a living wage
Access restrictions:
Resources are cut off conditions of locations such as hazards to produce
Non-existent infrastructure to permit production or acquirement
Insufficient trained labor
Lack of technology or knowledge to access
Worst Case scenario:
Managing limited supply resource that maybe only viable economic resource to an entire economy and life is non-regenerating or renewable.
Depletion of resources- there none left to provide the commodity market collapses.
Historical and On-going Events:
One must assume that in the course of human history also plays a role even past events may limit current valuation in commodity trades - such as the Iraq War 2003-2010, Gulf War 1990 and the Iranian War with Russia where the oil wells were set on fire that took months even just past a year to be put out - it was estimated some 100-500 years of oil reserves were depleted or more other such resources were depleted by various incidents such as a mining accident in Centralia, PA a fire that started in 1962 is still burning today it' estimated will burn for some 250yrs that closed off an entire coal mining town. Some events stem far longer into the course of history may imply social injustice and extreme environmental damage that may increase existing costs on commodities or extreme desperation allowing underselling of commodities for necessity of human survival and resulting in social ill-will or future strife and civil unrest again to fluctuate commodity futures.
as in production possibility curve compares production rates of two commodities, this compares prices of different commodities.
Prices are a mechanism by which commodities are efficiently allocated in ideal conditions; prices send a signal about the value of a commodity.
No
yes
as with any product, prices will fluctuate with demand and supply. if the demand increases or supply is reduced, prices will rise. if demand falls or there surplus supply, the opposite also occurs.
Because prices can fluctuate rapidly with such commodities.
agricultural products expensive more than processed
As with all commodities prices fluctuate. For the current price, any decent supermarket will run and check for you , should you telephone. I would guess between 2.85- 3.92$ USD for the standard medium size.
Silver prices do not typically fluctuate a lot in a week. Silver and Gold are both slow and safe.
Prices of commodities such as precious metals prices fluctuate daily. See the link below for the latest price.
Example sentences for the verb to fluctuate:The financial scare caused the prices to fluctuate wildly.Gas prices fluctuate with the price of oil.My heart's rhythm always seemed to fluctuate wildly when she entered the room.This time of year, the temperature can fluctuate as much as thirty degrees in a day.In the desert, the temperature might fluctuate dramatically from day to night.
A person can find the latest prices on commodities from several locations. CNN, Bloomberg News, Nasdaq, and Reuters all broadcast the latest up to date prices of commodities, both on their television channel as well as on their websites.
When the prices of the commodities fall, the demand of that commodity usually increases. On the same note the supply of the given commodity usually decreases as well.
Arbab Ikramullah has written: 'Prices of agricultural commodities in Bannu, 1961-70' -- subject(s): Agricultural prices 'Prices of agricultural commodities in Kohat, 1961-74' -- subject(s): Agricultural prices, Farm produce, Prices
The word 'fluctuate' is a verb (fluctuate, fluctuates, fluctuating, fluctuated), a word meaning to vary irregularly.Example uses:The financial scare caused the prices to fluctuatewildly.The market's stocks have been fluctuating since 2009.Gas prices fluctuate with the price of oil.My heart's rhythm always seemed to fluctuate wildly when she entered the room.This time of year, the temperature will fluctuate as much as thirty degrees in a day.In the desert, the temperature might fluctuate dramatically from time to time.My weight tends to fluctuate.
approximately 1.7 cents, but because metal prices fluctuate, so does this figure approximately 1.7 cents, but because metal prices fluctuate, so does this figure
Commodity prices are quoted on either a spot or future basis on an electronic board each time they change. Future prices are quoted based on the date of delivery of the contracted commodities.