A report has been prepared by FTI for the FOA on the impact of speculative trading in commodity markets - a review of the evidence. The issue of what drives commodity prices and whether their price volatility is excessive has always been of interest to policy makers. The balance between “real” economic factors that affect supply and demand and “financial” factors, especially in futures markets, which act separately of any physical trades taking place and which some feel distort prices in the “wrong” way has been constantly debated.
