Commodity :

A commodity may be defined as an article, a product or material that is bought and sold.

 Derivative Contract :

An enforceable agreement whose value is derived from the value of an underlying asset: the asset can be a currency, bond, commodity, precious metal,  stock, or indices of commodities, stocks etc.
Derivative instruments are known as forwards, futures, options and swaps/spreads.

Futures Contract :

Futures is a derivative instrument. Futures are contracts to sell/buy standardized financial instruments or commodities on a specified future date at an agreed price.

Prices determination for Futures:

Futures prices evolve from the interaction of bids and offers originating from all over the country - which converge in the trading engine. The bid and offer prices are based on the expectations of prices on the maturity date.

Commodity Exchanges:

Commodity Exchange is a common platform, where market participants from all over the country trade in wide variety of commodity derivatives

Long & Short Positions:

Long position is a net bought position, while short position is a net sold positions.

Security:

All the contracts are secured and their validity is guaranteed by the exchange.

Standardisation:

Futures contracts are standardised. The parties to the contracts do not decide the terms of futures contracts: they have to accept terms of contracts established by the Exchange.