Agricultural Product Derivatives - Israel

Israel

The nominal value in the Agricultural Product Derivatives market is projected to reach US$111.60bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 2.89% resulting in a projected total amount of US$128.70bn by 2029.
The average price per contract in the Agricultural Product Derivatives market amounts to US$0.31 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$12,320.00bn in 2024).
In the Agricultural Product Derivatives market, the number of contracts is expected to amount to 388.10k by 2029.

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Analyst Opinion

The Agricultural Product Derivatives market in Israel is experiencing a notable shift in recent years.

Customer preferences: Customers in Israel are increasingly showing interest in agricultural product derivatives as a way to diversify their investment portfolios and hedge against market volatility. This trend is in line with the global movement towards alternative investments and risk management strategies.

Trends in the market: One significant trend in the Israeli Agricultural Product Derivatives market is the growing popularity of derivatives linked to local agricultural commodities. Investors are showing a preference for derivatives tied to crops that are key to the Israeli economy, such as citrus fruits, dairy products, and vegetables. This trend reflects a desire to engage in markets that have a direct impact on the local agricultural sector.

Local special circumstances: Israel's unique geographical and climatic conditions play a crucial role in shaping the Agricultural Product Derivatives market in the country. The focus on technology and innovation in agriculture, such as drip irrigation and precision farming, influences the types of derivatives available and the risk factors associated with them. Additionally, Israel's position as a global leader in agricultural technology drives interest in derivatives linked to agri-tech companies.

Underlying macroeconomic factors: The stability of Israel's economy and its resilience to external shocks contribute to the attractiveness of agricultural product derivatives as an investment option. The government's support for the agricultural sector through subsidies and technological advancements also bolsters confidence in the market. Moreover, Israel's strategic location as a bridge between Europe, Asia, and Africa creates opportunities for international trade in agricultural products, influencing the demand for related derivatives.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.