What does an Agricultural Commodity Broker do?
Sure! A broker is somebody who acts as a middleman between somebody who is buying something–usually an investment in the Wall Street sense of the word–and somebody who is selling the same thing. The broker charges a fee, called a commission, for matching up the buyer and the seller. A commodity broker is somebody who matches up buyers and sellers of commodities, that is, of actual physical goods. Some examples of commodities are oil, natural gas, gold, beef, pork bellies, corn, and wheat. The important point is that commodities have to be essentially interchangeable with each other: one barrel of natural gas has to be just as valuable, and no more valuable, than another barrel in order to make it a commodity, and one boxcar of corn needs to look the same as a different boxcar of corn. That’s because the broker will buy and sell the commodity sight-unseen. If boxcar 1 is worth more than boxcar 2, then the whole system breaks down. But Kellog’s doesn’t want to go out and look at every
