• arbitrage theory
• bubbles
• Chicago Mercantile Exchange
• Commodities
• Commodity Index Funds
• convenience yield
• cost of carry
• fads
• FAO
• food security
• Futures Market
• Goldman Sachs Commodity Index
• hedging
• liquidity
• normal backwardation
• price transmission mechanisms
• Spot Market
• United Nations
• World Bank

The dissertation analyzes the recent price shocks in agricultural commodities. We look both at the spot prices as well as at the futures price.
The aim of the work is to try and understand the causes of these price increases by studying the fundamental price drivers of agricultural commodities, price transmission mechanisms between spot and futures prices and the efficiency of the futures market for basic grains&oilseeds.
The conclusion is that the futures market has indeed failed in its price discovery and hedging mechanisms but that such failure does not appear to be imputable to the activity of speculators and hedgers but to the structure of the futures contracts themselves. There also appears to be no evidence of futures prices influencing spot prices in the cash market, on the contrary a fundamental analysis of supply and demand factors finds many drivers that could explain the recent rise in global food prices.
The possibility that Commodity Index Funds may be influencing prices or altering market liquidity is also analyzed. We compare data from the U.S. Commodity Futures Trading Commission on positions held for hedging reasons and positions held by Commodity Index Funds and find, again, no evidence that Index Funds may be reducing market liquidity or influencing prices on the long term.
Finally, recent institutional interventions to try and curb food prices and increase food security are outlined.