POSSIBILITIES FOR DEVELOPMENT OF COMMODITY EXCHANGE IN SERBIA
DOI:
https://doi.org/10.5937/ekoPolj1804557JKeywords:
commodity exchange, spot trading, forwards, futures, hedging strategiesAbstract
The aim of the paper is the analysis of the current situation related to the spot and non-standardised term commodity exchange market, as well as to provide a proposal for further improvement of commodity-trading in Serbia. The system of commodity-exchange trading in Serbia has not been developed and legislation has not been fully enacted. According to the analysis of price variability on three commodity markets it can be concluded that the fluctuations of prices of agricultural products in the last decade were very high, which led to market participants need for term commodity exchange instruments. The paper presents suggestions for further improvement of the spot market as well as the clearing model on the forward market. The adoption of the Law on Commodity Exchange and amendments to the Law on Capital Market would improve the spot trading, trading of non-standardised and standardised term contracts.
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References
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22. Stošić Mihajlović, Lj., & Zdravković, I. (2016). Forward, future and options on stock exchange market. Journal of Process Management - New Technologies, International, 4(3), 50-56. doi:10.5937/jouproman4-11324
23. UNCTAD. (2009). Development Impacts of Commodity Exchanges in Emerging Markets, report, United Nations Conference on Trade and Development (UNCTAD), Geneva, Switzerland.
24. Vavra, P. (2009). Role, Usage and Motivation for Contracting in Agriculture, OECD Food, Agriculture and Fisheries Working papers, no. 16, OECD Publishing, Paris, France, 1-36.
25. Veselinović, Ј., Marković, T., & Đukić, S. (2014). Analysis of legal and economic aspects of precipitation weather derivatives for Serbian agricultural sector. Economics of Agriculture, 61(4), 1053-1067. UDC: 551.502.4:347.447(497.11)
26. Weber, M. (2000). Commerce on the Stock and Commodity Exchanges. Theory and Society, 29(3), 339-371. Retrieved from https://www.jstor.org/stable/3108486
27. Working, H. (1953). Futures Trading and Hedging. The American Economic Review, 43(3), 314-343.
28. Zakić, V., & Vasiljević, Z. (2013). Establishment of the commodity derivativesmarket in the function of agribusiness sector improvement in Serbia (Uspostavljanje tržišta robnih derivata u funkciji unapređenja agrosektora u Srbiji). Ekonomski vidici, 18(1), 49-61.
2. CME. (2018). Data on corn prices for the period 2010-2018. Web portal of CME Group (Chicago Mercantile Exchange), Chicago, USA, Retrieved from www.cmegroup.com
3. Commodity Exchange Novi Sad. (2018a). Data on corn prices for the period 2007-2018. Web portal of Commodity Exchange Novi Sad, Serbia. Retrieved from www.proberza.co.rs/
4. Commodity Exchange Novi Sad. (2018b). Total volume of trading and number of forward contract traded, Commodity Exchange in Novi Sad, Serbia, data obtained on request during the July 2018.
5. Erokhin, V. (2017). Factors influencing food markets in developing countries: An approach to assess sustainability of the food supply in Russia. Sustainability, 9(8/1313), 1-13. doi:10.3390/su9081313
6. FMFA. (2015). Price fluctuations (volatility) of agricultural commodities, Federal Ministry of Food and Agriculture (FMFA), Berlin, Germany. Retrieved from www.bmel.de/EN/Agriculture/Market-Trade-Export/_Texte/Preisvolatilitaet.html
7. Geyser, J. M. (2000). Decision support system to manage investment risk of grain farmers in South Africa, PhD thesis, University of Pretoria, Pretoria, SAR.
8. Harwood, J., Heifner, R., Coble, K., Perry, J., & Somwaru, A. (1999). Managing Risk in Farming: Concepts, Research, and Analysis, Agricultural Economic Report, no. 774, Economic Research Service (RSA), U.S. Department of Agriculture (USDA), Washington, USA.
9. Jayne, T. S., Sturgess, C., Kopicki, R., & Sitko, N. (2014). Agricultural Commodity Exchanges and the Development of Grain Markets and Trade in Africa: A Review of Recent Experience, working paper no. 88, Indaba Agricultural Policy Research Institute (IAPRI), Lusaka, Zambia, 1-30.
10. Jeločnik, M. (2017). Economic instruments for climate risks management in crop production in Republic of Serbia, Doctoral Dissertation, University of Novi Sad, Faculty of Agriculture, Novi Sad, Serbia (Ekonomski instrumenti za upravljanje klimatskim rizicima u ratarskoj proizvodnji Republike Srbije, doktorska teza, Poljoprivredni fakultet, Univerzitet u Novom Sadu, Novi Sad, Srbija).
11. Kleinman, G. (2001). Commodity futures and options: A step by step guide to successful trading. Prentice Hall, NJ, USA.
12. Kohls, R., & Uhl, J. (2002). Marketing of agricultural products. Prentice Hall, NJ, USA.
13. Kolb, R., & Overdahl, J. (2007). Futures, Options and Swaps, 5th edition. Blackwell Publishing, NJ, USA.
14. Kovačević, V. (2013). Introduction of the grain futures market in the Black Sea region. Economics of Agriculture, 60(4), 695-712. UDC: 339.13:633.11(262.5)
15. Kovačević, V., & Milošević, I. (2017). Significance and Development Preconditions of Commodity Exchange Trade with Agricultural Products in Serbia (Značaj i preduslovi razvoja berzanskog trgovanja poljoprivrednim proizvodima u Srbiji). Škola biznisa, 10(2), 172-178. DOI 10.5937/skolbiz2-14320
16. Kovačević, V., & Vasiljević, Z. (2017). Development of commodity exchanges in function of agribusiness in Serbia, in: Sustainable agriculture and rural development in terms of the Republic of Serbia strategic goals realization within the Danube region: Development and application of clean technologies in agriculture, (Eds.) Vasile, J., Subic, J., Kuzman, B., Institute of Agricultural Economics, Belgrade, Serbia, 430-445.
17. Kuzman, B., Ercegovac, D., & Momčilović, M. (2018). Development of derivative trading on financial market and agribusiness sector in Serbia. Economics of Agriculture, 65(2), 601-616. doi:10.5937/ekoPolj1802601K
18. Law on Capital Market, Offcial Gazette of the Republic of Serbia, no. 31/2011.
19. Madre, Y., & Devuyst, P. (2016). Are futures the future for farmers?, web portal of Farm Europe, Bruxelles, Belgium, Retrieved from www.farm-europe.eu/ travaux/are-futures-the-future-for-farmers-2/
20. MATIF. (2018). Data on corn prices for the period 2011-2018., web portal of MATIF (Marché à Terme International de France), Paris, France, Retrieved from www.euronext.com/en
21. MTTT. (2018). Draft Law on Commodity Exchange, Ministry of trade, tourism and telecommunications of the Republic of Serbia, Retrieved from http://mtt.gov.rs/slider/jr-nacrt-zakona-orr/?script=lat
22. Stošić Mihajlović, Lj., & Zdravković, I. (2016). Forward, future and options on stock exchange market. Journal of Process Management - New Technologies, International, 4(3), 50-56. doi:10.5937/jouproman4-11324
23. UNCTAD. (2009). Development Impacts of Commodity Exchanges in Emerging Markets, report, United Nations Conference on Trade and Development (UNCTAD), Geneva, Switzerland.
24. Vavra, P. (2009). Role, Usage and Motivation for Contracting in Agriculture, OECD Food, Agriculture and Fisheries Working papers, no. 16, OECD Publishing, Paris, France, 1-36.
25. Veselinović, Ј., Marković, T., & Đukić, S. (2014). Analysis of legal and economic aspects of precipitation weather derivatives for Serbian agricultural sector. Economics of Agriculture, 61(4), 1053-1067. UDC: 551.502.4:347.447(497.11)
26. Weber, M. (2000). Commerce on the Stock and Commodity Exchanges. Theory and Society, 29(3), 339-371. Retrieved from https://www.jstor.org/stable/3108486
27. Working, H. (1953). Futures Trading and Hedging. The American Economic Review, 43(3), 314-343.
28. Zakić, V., & Vasiljević, Z. (2013). Establishment of the commodity derivativesmarket in the function of agribusiness sector improvement in Serbia (Uspostavljanje tržišta robnih derivata u funkciji unapređenja agrosektora u Srbiji). Ekonomski vidici, 18(1), 49-61.
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Published
2018-12-28
How to Cite
Jankovic, I., Jelocnik, M., & Zubovic, J. (2018). POSSIBILITIES FOR DEVELOPMENT OF COMMODITY EXCHANGE IN SERBIA. Economics of Agriculture, 65(4), 1557–1571. https://doi.org/10.5937/ekoPolj1804557J
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Review articles
