Definition of backwardation in English:
noun[mass noun] Stock Exchange , British
1A situation in which the spot or cash price of a commodity is higher than the forward price: the development of a backwardation is associated with supply shortage Often contrasted with contango.
More example sentences
- In the case of agricultural commodities backwardation provides a most powerful incentive for traders to sell the cash commodity and buy the futures.
- Ministers have announced plans to cut production before prices start to weaken, helping to create the conditions for a sustained price backwardation, pricing physical oil at a premium to future supplies.
- This caused a significant disturbance in the market and exacerbated a backwardation in the price of tin.
1.1A situation in which the offer price for stock is lower than the bid.
- Gold remains in backwardation right out to the six month term but at low rates.
- I am sure that your position is a hedge, but if your physical metal is delayed, you may have to borrow at this backwardation.
- The backwardation widened to $28.50 per tonne in aftermarket trading late Wednesday.
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