ArticleslgStudy

science

Soft commodity

Soft commodity is a science topic covered in the lgStudy science library. This page brings together a partial reference excerpt, illustrations, worked examples, real-world applications and a short study plan, so you can understand Soft commodity rather than just read about it. In short: Soft commodities, or softs, are commodities such as coffee, cocoa, sugar, corn, wheat, soybean, fruit and livestock. The term generally refers to commodities that are grown, rather than mined; the latter (such as oil, copper and gold) are known as hard commodities.

Key takeaways

  • Soft commodity belongs to science; place it in that map before memorising details.
  • Learn the definition first, then one example that makes the definition concrete.
  • Connect Soft commodity to a quantity you can measure, compute or draw — that is where exam questions come from.
  • Reproduce the core statement of Soft commodity from memory before moving on to harder problems.

Reference excerpt

Soft commodities, or softs, are commodities such as coffee, cocoa, sugar, corn, wheat, soybean, fruit and livestock. The term generally refers to commodities that are grown, rather than mined; the latter (such as oil, copper and gold) are known as hard commodities. Soft commodities play a major part in the futures market. They are used by farmers wishing to lock-in the future prices of their crops, by commercial purchasers of the products, and by speculative investors seeking a profit. The adjective "soft" is occasionally only applied to products that are classified as largely tropical, such coffee, chocolate, sugar, cotton, and orange juice. Soft commodities have been known to adopt a backwardation trend until the late 1990s when futures were actively traded. Speculation and investment requirements later shaped the common contango trend.

See also Commodification Commodity status of animals

References

Worked examples

Example 1 — a first encounter with Soft commodity

Start with the simplest possible case. Write down what Soft commodity claims or describes in one sentence, then invent the smallest concrete situation in which that sentence is true. In science, the smallest case is usually a single object, a single equation or a single measurement. Check that every symbol or term in your sentence has a meaning in that case.

Example 2 — changing one variable

Take the situation from Example 1 and change exactly one quantity: double it, halve it, or set it to zero. Predict what should happen to Soft commodity before you calculate. Comparing your prediction with the result is the fastest way to find out whether you understand the idea or only the words.

Example 3 — an exam-style question

Typical questions about Soft commodity ask you to (a) state it precisely, (b) apply it to given data, and (c) explain a limitation. Practise writing all three answers in under five minutes; the third part is what separates a full-mark answer from an average one.

Applications of Soft commodity

In research
Soft commodity appears in science research whenever the underlying quantities have to be modelled precisely. Papers usually cite it as a starting assumption and then explore where it breaks down.
In technology and industry
Engineering practice reuses Soft commodity in design rules, simulations and safety margins. Knowing the idea lets you read a specification sheet and understand why the numbers look the way they do.
In the classroom
Soft commodity is common in secondary-school and first-year university syllabi. It links to neighbouring topics Commodities used as an investment, Finance stubs, so understanding it makes those chapters shorter.
In everyday life
Look for Soft commodity outside the textbook — in sport, cooking, traffic, electronics or the sky above you. An example you found yourself is remembered far longer than one you were given.

Affiliate

Preply — study more efficiently by working with a personal tutor. 50% off.

How to study Soft commodity in 20 minutes

  1. Read the reference excerpt below once, without taking notes.
  2. Close the page and write down what Soft commodity means in your own words.
  3. Compare your version with the excerpt and mark what you missed.
  4. Work through the three examples above with pen and paper.
  5. Explain Soft commodity out loud to somebody else — or to Teacher Smith in the lgStudy chat.

Frequently asked questions

What is Soft commodity in simple terms?

Soft commodities, or softs, are commodities such as coffee, cocoa, sugar, corn, wheat, soybean, fruit and livestock. The term generally refers to commodities that are grown, rather than mined; the latter (such as oil, copper and gold) are known as hard commodities.

Why does Soft commodity matter?

Because it connects several science ideas at once: it gives you a definition you can apply, a quantity you can calculate, and a way to check whether a result is plausible.

How should I study Soft commodity?

Read the excerpt, restate it from memory, then work through the examples and applications listed on this page. The five-step study plan above takes about twenty minutes.

What does this page cover?

It gives you a compact reference excerpt plus original lgStudy explanations, examples, applications and study material on Soft commodity.

Tags

  • Commodities used as an investment
  • Finance stubs

Keep exploring