- Free Essays, Term Papers & Book Notes

Development of Agricultural Commodity Exchanges in Ukraine

By:   •  Research Paper  •  459 Words  •  March 17, 2010  •  824 Views

Page 1 of 2

Development of Agricultural Commodity Exchanges in Ukraine



The paper presents analysis and assessment of the current situation with Ukrain-ian agricultural commodity exchanges and their development prospects. Today, there is a need for an efficient market infrastructure, capable of ensuring trans-parent sales of agricultural commodities. In the developed countries, exchange trading in agricultural commodities is the most efficient way for determining market prices. However, most Ukrainian exchanges function as superstructure at the spot agricultural market. The government does not actually participate in the exchange trading. Because of relatively small sizes of exchanges, they are not able to create the material basis, necessary for implementation of progres-sive technologies of exchange trading. Forward and futures transactions are not popular, because they are associated with collateral, which should be provided by the supplier (producer) in case it fails to honor its obligations. In general, development of agricultural commodity exchanges is related to the institutional setting of agricultural market.

Keywords: commodity exchange, agricultural market, market infrastructure, market transparency


With elimination of the state system of contracts for sale of agricultural commodities, the old marketing infrastructure became unable to provide effi-cient functioning of agricultural market. Though many commercial intermediar-ies appeared, they did not possess any material and technical basis, and they also used non-transparent schemes of trade in agricultural commodities. So, the need arose for an efficient market infrastructure, capable of ensuring transparent sales of agricultural commodities by agricultural producers.

The problem of market non-transparency became very acute in the mid-1990s. In order to solve it, in 1995 President's edict introduced the agricultural commodities exchange trading, which became

Continue for 1 more page »  •  Join now to read essay Development of Agricultural Commodity Exchanges in Ukraine
Download as (for upgraded members)