Agricultural Commodity

This Issue in United States

Concept of Agricultural Commodity in Futures Trading

In this context of financial law, the following is a definition of Agricultural Commodity: An agricultural commodity is defined in Commission regulation 1.3(zz) as a commodity in one of four categories: (a) the enumerated commodities listed in section 1a of the Commodity Exchange Act, including such things as wheat, cotton, corn, the soybean complex, livestock, etc.; (b) a general operational definition that covers: “All other commodities that are, or once were, or are derived from, living organisms, including plant, animal and aquatic life, which are generally fungible, within their respective classes, and are used primarily for human food, shelter, animal feed, or natural fiber;” (c) a catch-all category for commodities that would generally be recognized as agricultural in nature, but which don’t fit within the general operational definition: “Tobacco, products of horticulture, and such other commodities used or consumed by animals or humans as the Commission may by rule, regulation, or order designate after notice and opportunity for hearing;” and (d) “Commodity-based indexes based wholly or principally on underlying agricultural commodities.”