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World prices are formed in representative international markets through competition, which is often changed by factors operating in conditions of imperfect competition, such as the existence of international monopolies, protectionist practices of some States, the evolution of economic conditions, and others.
However, no matter how strong the influence of these factors may be, the competitive market system seeks here to highlight the mechanism of supply and demand in the formation of international prices.
For the prices of most agri-food products and mineral raw materials, the most popular price system on the world market is the commodity exchange.
As you know, prices inside them are formed through an auction mechanism that reflects the free play of supply and demand. Since the quotation takes place on an international scale, the price level synthetically reflects the evolution of supply and demand for a particular product in the main national markets.
Another form of pricing is a specific form of international agreements (negotiations) on primary products.
Economic agents, producers and buyers agree on production quotas and the selling price within the framework of international mechanisms.
Thus, there are two limits within which prices can freely fluctuate.
If these limits are exceeded, the relevant States can intervene either in supply (through an export quota) or in demand through international regulatory reserves.
Therefore, in this case, prices can only fluctuate between these pre-set limits. In some situations, when concluding relevant agreements (for example, on coffee, wine, etc.), economic entities focus on setting an approximate price after the rates registered on international commodity exchanges.
For a number of mineral raw materials, prices are set by large production companies that control their extraction.
As a result, the leading price method is applied in the relevant markets, the price set by the companies dominating the market.
Other manufacturers are guided by them.
The same mechanism can be found in the markets of other products, especially manufactured ones, without excluding the possibility that competition will fully manifest itself in these markets.
In such cases, international tenders are the most commonly used form.
Here, we especially take into account the prices at which certain highly complex products are important, such as turnkey plants, technological lines, or certain infrastructure elements (telecommunications, highways, bridge and airport construction, railway construction). Join 1xBet with the 1xbet promo code a 100% welcome bonus of up to BDT 15600 for Bangladesh players. 1xBet offers one of the most unique bookmaker bonuses you will ever see, with a bonus for a series of losing bets. This promo allows you to earn bonus bets if you are on a bad losing streak.
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| Disclamer: Our trading platform is designed to promote trade by bringing buyers and sellers (suppliers) together using the Internet.
OurMetals.com assumes no liability for errors, omissions and/or misinterpretations pertaining to OurMetals.com listings.
OurMetals.com assumes no responsibility for any and all details, agreements, and terms between the buyer and seller of materials listed in the Exchange.
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