Compare Brokers For Trading Corn

Looking for brokers for trading corn? We have compared 11 broker accounts (out of 147) that are suitable for you below.

We found 11 broker accounts (out of 147) that are suitable for Corn.

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Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data.

The Ultimate Guide to

What is Corn?

Corn is one of the most important crops throughout the world, and one of the most highly traded commodities in the market. It is cultivated across the globe and is produced in much higher weights than any other grain.

The world’s total corn production in 2016 was 1.05 billion metric tons. The United States were the leading producers, accounting for 37% of the world’s total corn production. Their corn belt, which has been producing corn since the 1850s, is mainly responsible for the US’s predominance in corn production. China followed with a 21% share of the global total, and other major corn producing countries included Brazil, the EU, Argentina, Ukraine, and India.

Distribution of global corn production in 2016/17, by country

Distribution of global corn production in 2016/17, by country – Statista.com

Fundamental Influences on Corn Prices

Corn has been primarily used as a source of food for thousands of years; however, it has also become an important source of fuel in the past few decades. Almost 40% of corn is used for producing Ethanol, an alcohol that has become a primary component of gasoline.

This has led to a direct relationship between the demand for corn and ethanol. If the demand for ethanol rises, the demand for corn will ultimately rise.

Climate can also affect the short and long term prices of corn. Corn has very low resistance against unstable and severe climate changes, and such changes in climate can lead to a decrease in production and thus, an increase in price.

Another considerable factor is demand from the Chinese market. China is the world’s largest producer and consumer of energy and has been since 2010. China’s inclination towards producing clean energy can lead to an increased demand for biofuels like ethanol, and consequently, an increased demand for corn.

How is Corn Traded?

Corn can be traded through contracts for difference (CFDs) and futures contracts. Traders usually do not want to take delivery of the actual commodity, and so these products enable a trader to speculate on the price of corn without having to physically own the commodity.

Corn futures contracts are offered by the Chicago Mercantile Exchange (CME) and these are one of the most highly traded agricultural contracts, with an average volume of several billion dollars each day.

In the case of CFDs, if a trader believes the price will rise, they can go long, or buy contracts, and if they believe the price will go down, they can sell or short contracts. Regulated brokers such as AvaTrade and Plus500 offer corn as a CFD, and the CFD is actually based on the price of the CME futures contract.

Corn futures are traded under the ticker symbol ‘C’ on the Open Outcry market and under ‘ZC’ on electronic markets. Like any other commodity, corn futures contracts have their own margin requirements and contract value.

Advantages of Trading Corn as a CFD

CFDs are a convenient way of trading corn as minimum positions can be quite low. CFDs involve speculation from a trader on whether the price of the underlying commodity (corn) will rise or fall. Plus500 offers a leverage of 1:152, with a minimum trade of 10,000 bushels and spread of 0.50. So a margin of just £175 is required to expose a trader to £26,451 worth of value.

Spot Corn vs. Corn Futures

Spot Trading:

  • Priced on the basis of immediate delivery

  • Trades are settled instantly

  • Delivery issues are mostly unpredictable and can suddenly arise

Futures Trading:

  • Priced on the basis of a forecast of future pricing

  • Position can be kept open but is subject to time

  • Volatility factors are comparatively more predictable

Related Commodities

  • Gasoline

  • Ethanol

  • Oil

Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data.