Thin Markets for Agricultural Products: Causes, Effects, and Public Policy Options

摘要

Changing methods of price discovery for several agricultural commodities have resulted in thinly-traded markets: markets in which buyer-seller negotiation occur for only a small proportion of total volume traded. As markets become thin, reported prices become less reliable indicators of overall supply and demand conditions and the potential for price manipulation may increase. Methods to rectify possible performance problems attributable to thin markets include encouraging open public trading and improving the quantity and quality of price reports.