Why Are Agricultural Commodities Important?
Agriculture has long been the backbone of the global economy, and investing in this sector can be a profitable and rewarding venture. As the world's population continues to grow, the demand for food, fiber, lumber,and other agricultural products is set to increase too. This is making agriculture a promising area for investment.
Why Are Agricultural Commodities Important?
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Agricultural commodities are staple crops and animals produced or raised on farms or plantations. Most agricultural commodities such as grains, livestock and dairy provide a source of food for people and animals across the globe.
However, some agricultural commodities have purely industrial applications. The building and furniture industries use lumber from trees, while manufacturers in several sectors use latex from the rubber tree. Wool from sheep provides fabric for the clothing industry and lanolin for skin- and hair-care products.
Some agricultural commodities serve as both a source of food and an industrial ingredient. Both humans and animals consume corn, but the commodity is also an important ingredient in fuel production. Similarly, humans eat the beef of cows, while a variety of industries use beef hide, fats and bones to create products.
In addition, over 1.3 billion people – nearly 20% of the global population – work in farming. In some regions of the world, such as South Asia and Sub-Saharan Africa, farming employs more people than any other industry.
The global impact of the agricultural industry is enormous. According to the Food and Agricultural Organization of the United Nations, the economic value of the agriculture industry, in constant 2010 dollars, is more than $3 trillion.
With the world population expected to climb from 7.5 billion to 11.8 billion by 2100, agricultural commodities are likely to play an even bigger role in the decades ahead.
What Are the Different Agricultural Commodities?
Agricultural commodities fall into one of six categories:
- Cereal Grains
- Oilseeds
- Meat
- Dairy
- Other Soft Commodities
- Miscellaneous Agricultural Commodities
A unique opportunity
Agricultural commodities are staple crops and animals produced or raised on farms or plantations. Most agricultural commodities such as grains, livestock and dairy provide a source of food for people and animals across the globe.
Low minimal entry
Agricultural commodities are staple crops and animals produced or raised on farms or plantations. Most agricultural commodities such as grains, livestock and dairy provide a source of food for people and animals across the globe.