The significance of commodity exchanges for trade in agricultural products in the Czech Republic, and prospects of their future development

Abstract

The paper deals with the functioning of commodity exchanges in the Czech Republic, and is particularly concerned with exchanges trading in agricultural production commodities. The introductory part of the paper is oriented towards the theory and general structure of commodity exchanges; the other parts subsequently deal (in more detail) with the most problematic areas of their operation in the Czech Republic up to the present time. Within this part of the paper, the method of analytical evaluation is used for examining, above all, the existing legal regulation, the structure and function of these exchanges. Subsequently, using the method of comparative analysis, selected key aspects of their operation are compared with the theoretical requirements of their functioning as well as with the everyday functioning of this kind of exchange in economically developed countries. Findings gathered this way are subsequently utilized in the concluding part of the paper, the subject matter of which is a prediction about the possible variants of the future development of Czech agricultural commodity exchanges, with regard to the assumed admission of the Czech Republic to the European Union.

Keywords

• prompt transactions
• futures
• options
• liquidity
• agricultural commodities
• hedging
• risks