Normally, commodity is defined as a product, goods or even a service that cannot be differentiated and is traded on prices. Conventionally, commodities are understood as the output of the primary sector of an economy. In other words, they are the output that comes by activities like agriculture, extraction, and mining. Normally agricultural crops, like wheat, rice, pulses, spices or, minerals, metals, and crude oil are referred to as commodities.
Every raw output goes through a minor processing in order to become tradable. This process depends on the nature of a commodity. A basic product like cleaned and packed wheat has a minimum process applied. However, a commodity like sugar goes through a detailed production process and still qualifies as commodity. In order to make the product or produce a tradable commodity, there has to be some sort of process applied. But, it should not lead to creating unique identity.
In other words, “Commodities” means agricultural commodities, ferrous and nonferrous metals, precious metals, semi-finished/semi-processed commodities and finished/manufactured/processed commodities.
The Exchange will provide trading facilities in Agricultural Commodities, and non-agricultural Commodities. Depending on the members’ eligibility, they will be allowed to trade in these commodities.