Reviewed by Sep 30, 2020| Updated on
Hardening refers to the stabilisation or gradual increase in prices in the commodity futures market. Commodity traders, generally, enter into a futures contract to protect themselves against any unforeseen future volatility in prices.
Hardening is a measure of price volatility. Commodity prices fluctuate when there is no sufficient supply to meet the demand. Commodity prices harden when the supply meets demand. Such commodities include base metals, crops, crude oil, gold, and so on. Base metals such as copper and zinc are inputs for the manufacturing industry. Similarly, food crops like soy and corn form inputs for agro-based industries.