Commodities are basic goods traded over an exchange. Commodities fall into two broad categories: hard commodities such as crude oil, gold, silver and platinum (extracted from the earth) and soft commodities such as wheat, corn, coffee and sugar (cultivated and harvested). The standardisation of commodities (basis grade) ensures that a commodity is of a standard quantity and above a minimum quality level so as to make it interchangeable with the same product from all other producers trading on a given exchange.
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