A commodity is a primary good in commerce that is traded for its equivalent value in capital. Commodities might either be raw material of finished products. Most commodities have well defined markets where they are traded. At any point in time, the market value of a commodity is determined by the laws of demand and supply.
There are two major classifications of commodities viz- hard and soft commodities. Hard commodities are items that are extracted from the earth in raw form mostly through extraction and mining. Examples are gold, titanium, bauxite etc. Soft commodities are items that are grown such as corn, coffee, malt etc. Commodities could also be finished products such as consumer electronics, automobiles, personal computers, furniture etc.
Due to industrialization and globalization, the movement of commodities around the world has become a complex process in the global value chain. Raw materials are shipped by both Solid Bulk and Liquid Bulk carriers from South America and Middle East to markets in the Far East such as China, while manufactured goods are shipped by Ultra Large Container Carriers from China to the rest of the world.