Financial Factors in Price Movements of Primary Commodities on the International Market

Abstract

On international markets for raw materials and food the financialisation takes a form of a greater involvement of financial investors in the transactions made in commodity markets. The activity of those investors is distinctive -they treat commodity transactions as an alternative form of assets (such as investment in shares or real estate). The price tendencies for raw materials and food in commodity exchanges and hence in the international trade tend to resemble the price tendencies observed in traditional financial assets. Therefore the recent global financial crisis has been reflected not only in the movement of prices of shares and real estate but also the prices in international markets for commodities.