Contango and normal backwardation refer to the pattern of prices over time, specifically if the price of the contract is rising or falling.

The shape of the futures curve is important to commodity hedgers and speculators. Both care about whether commodity futures markets are contango markets or normal backwardation markets. This isn't ...

This notion that backwardation (that is, when distant deliveries trade at a discount to nearby deliveries, see "The Battle Against Contango") is somehow "normal" for a storable commodity is, to ...

Home Market Outlook Commodities Normal Backwardation Foiled Going Forward Sep. 17, 2013 11:53 AM ETCRUD, USO1 Comment Christopher Holt 222Followers ...

Normal backwardation occurs when the price of a futures contract is lower than the anticipated spot price of the underlying asset at the contract's maturity date.

Backwardation indicates the futures curve is falling, with spot markets and short-term futures contracts priced higher than longer-dated contracts.

The shape of the futures curve is important to commodity hedgers and speculators. Both care about whether commodity futures markets are contango markets or normal backwardation markets. This isn't ...

The theory of normal backwardation is predicated on the assumption that producers of commodities would seek to hedge the price risk of unexpected deviations between futures and spot prices.

But now, things are once again returning to the ‘normal’ state of backwardation — a move which has been interpreted by the market as a return to tight fundamentals.

Contango and backwardation are terms used in commodity futures markets. Learn more about futures trading and what these terms mean for hedgers and speculators.

In the world of commodities, the differential between one delivery period and another for the same raw material can go by different names, but they all have the same meaning.