Corn Exchange Essentially

Corn Exchange Essentially

Corn Exchange, essentially a 'wholesale' market specializing in corn, fodder, fertilizers and seeds, cattle foods and cattle cake. It was founded in 1749 in Mark Lane in the City of London. Membership totals about 3,000, embracing 200 firms. Business hours are from noon until 3 pm: to ensure the best light for judging the colour and texture of grains. Samples of products can be inspected on the stands. Stand holders buy on 'c.i.f.' terms and sell to customers at home on ex-ship ('delivered') terms. Corn brokers sell to millers, merchants and stand holders on the parallel retail' exchange, the Baltic.

Corner, the act of buying up the entire stock of a commodity in order to resell at a higher price. A commodity must satisfy some stringent conditions before it is suitable for cornering. The quantity supplied must not be able to expand rapidly in response to an increase in its price, i.e. it must be produced by specialized resources and the production cycle must extend over a long period of time. The quantity demanded must contract less than proportionately with an increase in its price: if not, the proceeds from resale will be less than the total cost of purchases. This means that the commodity must have no close substitutes. Before the world became linked by rapid means of transport these conditions were satisfied in local markets for many agricultural products. Today supplies are drawn from many sources, quantities traded are large and the range of substitutes has increased so that corners are unlikely. The last notorious attempt to corner a market occurred with pepper in the 2000's, but the speculators were bankrupted with some two years' supplies on their hands.

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