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Soft Commodities Trading

Trade Soft Commodities with VT Markets

Soft commodities are an exciting new market accessible to VT Markets traders via the MT4 platform. This commodity class is a thriving market with a large number of buyers and sellers of the physical assets underlying the futures market.

The term “soft commodities” refers to commodities that are grown, as opposed to being mined. For example, gold is a precious metal extracted from the ground through mining, while cocoa is a soft commodity grown on trees.

Soft commodity markets have roots dating back thousands of years and continue to play a significant role in the liquidity of global futures markets. They offer farmers the ability to hedge against natural disasters and secure long-term profits, ensuring smooth production and providing speculation opportunities.

The demand for soft commodities, as the foundation of food and clothing production, will persist. Take advantage of this persistent demand by trading soft commodities with VT Markets.

Explore the types of soft commodities you can trade

VT Markets allows trading of the following soft commodities contracts via MetaTrader 4
platforms:

  • Cocoa
  • Coffee
  • Cotton
  • Orange juice
  • Raw sugar
  Product
symbol
Product
type
Trade
market
Size/
volume
Quote
sample
Contract
currency
Max.
leverage
Min.
volume
Max.
volume
Min Spread
(ref only)
Avg. Spread
(ref only)
 
  Cocoa-C US Cocoa
Cash
Nymex/CME 10 lbs 2426.1 USD 20 0.1 40 50 50  
  Coffee-C Coffee Arabica
Cash
Nymex/CME 37500 lbs 0.9716 USD 20 0.1 40 29 29  
  Cotton–C Cotton Cash Nymex/CME 50000 lbs 0.60309 USD 20 0.1 40 152 152  
  Orange-C Orange Juice
Cash
Nymex/CME 15000 lbs 1.2480 USD 20 0.1 40 89 89  
  Sugar-C Sugar Raw
Cash
Nymex/CME 112000 lbs 0.11981 USD 20 0.1 40 50 50  
  XPTUSD Platinum vs US Dollar Nymex/CME 10 ounces 966.17 USD 20 0.1 10 244 656.91  
  XPDUSD Palladium
Cash
Nymex/CME 10 ounces 2092.45 USD 20 0.1 10 152 955.06  
  Soybean-C Soybean
Cash
Nymex/CME 500 bushels 17.556 USD 20 0.1 10 20 20.1  
  Wheat-C US Wheat (SRW)
Cash
Nymex/CME 1000 bushels 11.284 USD 20 0.1 10 12 12.9  

FAQs

  • What are soft commodities? How do they differ from hard commodities?

    Soft commodities, or agricultural commodities, are primarily derived from agricultural products or natural resources. They include products such as wheat, corn, soybeans, sugar, coffee, cocoa, cotton and other crops.

    On the other hand, hard commodities are non-agricultural commodities that are extracted from the earth or natural resources. They include precious metals like gold, silver and platinum, industrial metals like copper, aluminium and nickel, energy commodities like crude oil, natural gas and minerals like iron ore and coal.

    The main difference between soft and hard commodities is their origin and production process. Soft commodities are typically cultivated or farmed, involving agricultural practices, while hard commodities are extracted from the earth through mining, drilling or extraction processes.

    Soft commodities are influenced by weather patterns, disease outbreaks, harvest yields and global supply and demand dynamics. They are also susceptible to geopolitical events, trade policies and government regulations related to agriculture. In contrast, hard commodities are influenced by factors such as global economic conditions, supply and demand dynamics, geopolitical tensions and technological advancements.

  • What are the benefits and risks associated with trading soft commodity CFDs?

    Soft commodities play a significant role in global trade and investment, bringing significant benefits and risks. Like other derivatives, soft commodity CFDs allow traders to participate in the price movements of these commodities without physically owning or storing them. This also means that traders can use leverage, in which traders can control larger positions with a smaller amount of capital.

    Soft commodity CFDs can also help diversify an investment portfolio by adding exposure to the agricultural sector, which can reduce the impact of market volatility on the overall portfolio.

    However, given the nature of their origin, soft commodities are also subject to supply and demand issues. Soft commodities are influenced by crop yields, disease outbreaks, seasonal variations and government policies related to agriculture. They’re also susceptible to price manipulation, as various stakeholders, including farmers, traders and speculators, can influence them.

  • What factors influence the prices of soft commodities?

    If you’re looking to trade soft commodities online, it’s important to be aware of the factors that can cause prices to fluctuate so that you can adjust your trading style accordingly. Weather plays a crucial role in agricultural production. Extreme weather events such as droughts, floods, storms or frost can significantly affect crop yields and quality, increasing prices.

    Soft commodity prices are also often quoted using the US dollar, which means that currency exchange rates can influence the competitiveness of exports and imports, impacting demand and prices. Changes in the cost of transportation, such as the cost of fuel and electricity, also play a role in price fluctuations.

  • What are the trading hours for soft commodity CFDs on VT Markets?

    Trading hours for soft commodity CFDs on VT Markets depend on the commodity you want to trade with. Our trading hours are as follows:

    • Cocoa-C — 12:45-20:30 (GMT+3)
    • Coffee-C — 12:15-20:30 (GMT+3)
    • Cotton-C — 04:00-21:20 (GMT+3)
    • OJ-C — 15:00-21:00 (GMT+3)
    • Sugar-C — 10:30-20:00 (GMT+3)
    • Soybean-C — Monday – Friday: 03:00-15:45, 16:30-21:20 (GMT+3)
    • Wheat-C — Monday – Friday: 03:00-15:45, 16:30-21:20 (GMT+3)
  • How can I deposit and withdraw funds from my VT Markets soft commodity trading account?

    Deposits and withdrawals can be easily managed through the VT Markets Client Portal, providing you with convenience and control over your trading account. Ensure that funds are deposited from a source bearing the same name as your trading account. Accepted payment options include credit or debit cards and alternative payment accounts.

    We aim to process withdrawal requests promptly, typically within one business day. However, please note that the timeframe for receiving your funds can vary, ranging from 1 to 7 business days. The exact duration depends on the specific banking and payment systems involved in the transaction.

  • How can I start trading soft commodities on VT Markets?

    To begin soft commodity trading with VT Markets, you will need to open a live account and make an initial deposit. Choose your preferred trading platform and select the shares you wish to trade. Wait for optimal market conditions that align with your trading strategy before executing and monitoring your trades. Should you have any questions or need assistance opening an account, please don’t hesitate to contact us.

    If you prefer to gain practical experience before diving into live trading, VT Markets offers a demo account designed to help traders build confidence. With the VT Markets demo account, you can familiarise yourself with the market’s complexities without needing real capital. This allows you to refine your trading skills and test different strategies in a risk-free environment.

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