Commodity Market

Issue

   The commodity market provides a means of trading raw materials and other products (e.g., oil, wheat, livestock) for its use in production and consumption by nations. The problem is that if a particular issue occurs in a specific region, it also affects the price of the commodity in other regions on a global scale.

Solution

   To prevent this, the commodity market should become segmented and regionally based so that detrimental effects for the commodity would be restricted to a specific region (e.g., corn-east, corn-west, etc.).

   For example, if an issue occurs such as a drought that affects a specific crop, the price would only affect that particular region and not elsewhere that may provide the same commodity.

   The protection not only applies for natural disasters but also for other situations as well, such as military conflicts or trade embargoes. So, if an armed conflict occurs in the Middle East, it would only affect the price of oil from that region and not elsewhere such as the Americas (America, Brazil), Asia (Russia, Kazakhstan), or the Arctic (Canada, Norway).

   The commodity market should be corrected in this manner so that regional effects don't impact the global economy.