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Oats Trading: 28 things you should know before you start (Strategies and Backtest Analysis)

Last Updated on 10 February, 2024 by Rejaul Karim

Oats futures are trading trhough Chicago Mercantile Exchange (CME) trading platform. Oats futures trading is an exciting and potentially profitable way to invest in the global grains market. As one of the most versatile and widely used grains in the world, oats are an important commodity for farmers, processors, and consumers alike. By trading oats futures, investors can gain exposure to price movements in the oats market, and potentially profit from fluctuations in demand and supply. In this article, we’ll take a closer look at what oats futures trading is, how it works, and the benefits and risks associated with this type of investment. Whether you’re a seasoned trader or a novice investor, this guide will provide you with the information you need to make informed decisions about trading oats futures.

Everything you need to know in order to start Oats trading

1. What is oat trading?

Oats trading is the buying and selling of Oats contracts or instruments in order to make a profit.

2. What are oat futures?

The term oat futures refers to futures contracts that allow traders to buy or sell a contract today to be settled at a future date. Oats futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of oats (eg. 5000 bushels) at a predetermined price on a future delivery date.

Oats Trading: 28 things you should know before you start (Strategies and Backtest Analysis)

3. How are oats traded?

Oat futures contracts are offered on the Chicago Mercantile Exchange (CME), and they can be traded from any part of the world through the Globex electronic trading platform. One oat futures contract is equivalent to 5,000 bushels (about 86 metric tons) of oats, and the price quotation is in cents per bushel. The minimum price fluctuation is ¼ of a cent per bushel or $12.50 per contract.

4. How do you start trading oat futures?

To start trading oat futures, all you need to do is to create an account with the exchange through your futures broker and deposit the required margin. Since it is a leveraged instrument, you need not have the full dollar worth of the contract before you can trade it. However, you have to be cautious about leveraged instruments — while you can make more money with them, you can also lose more.

5. What are oats trading at?

Prices of oats can be found here.

6. What is the current price of oats and oats futures?

You can also find the current oats prices here.

7. When do Oat contract expire?

The contract normally expires in the months of, March, May, July, September, and December. Trading ends on the business day preceding the 15th calendar day of the contract month. At expiration, the contract is settled by physical delivery. The last delivery day is the second business day after the last trading day. Traders, who don’t want to take or make delivery of the commodity, can roll over their contracts to the next expiration months.

8. Whats oat futures trading hour?

Sunday – Friday 7:00 p.m. – 7:45 a.m. CT and
Monday – Friday 8:30 a.m. – 1:20 p.m. CT

9. Where can I find trading charts?

Here you can find Oats trading charts.

10. Oat Futures Trading Strategies

Oat Futures Trading Strategies

The oats futures market is a really tough market for most trading strategy designers. The liquidity isn’t that great compared to other more popular markets, which makes slippage a great concern.

However, by putting in enough effort it is possible to find a strategy for this market. Just make sure to account for a lot of slippage!

If you’re interested in getting edges for trading strategies, we recommend that you have a look at our unique trading strategy membership!

11. What are the trading symbols for oats?

CME Globex: ZO
CME ClearPort: O
Clearing: O

12. What is the specification for the oats futures contract?

specification oats futures contract

13. Why should you start trading oats?

Traders have different reasons for playing the oat futures market. To some traders, the market provides opportunities for short-term speculative trading, while to others, the oats market provides a means for portfolio diversification or hedging against inflation. Players in the oat production industry trade oat futures to hedge their price risk.

  • Speculative trading: The majority of traders in the oat futures market are there for speculative trading. These traders aim to profit from the short-term fluctuations in oat prices.
  • Diversifying portfolio: Oat futures is one of the popular agricultural commodity futures, which fund managers and investors use to diversify their portfolio away from stocks and bonds. Spreading their investment across many asset classes helps them to reduce the effects of market risk on their portfolio.
  • Hedging against inflation: The purchasing power of paper money is regularly being eroded, as central banks frequently lower interest rates and print more money. So, some people invest in commodities, such as oats, to protect their wealth from inflation since commodity prices increase when the economy is heated up.
  • Securing a good price: Oat producers sell oat futures contracts to secure a profitable price for their produce, while merchants and retailers buy the contracts to ensure a stable supply of the commodity.

14. What is the contract size for oats futures?

It is currently: 5,000 bushels (~ 86 metric tons)

15. What is the tick size of oats futures?

Tick size is $12.5 for Oat futures.

What is the minimum price fluctuation?

1/4 of one cent per bushel ($12.50 per contract)

16. How do you invest in oats?

You can invest in oats via futures contracts, options, CFDs or ETF.

17. Are there an ETF for investing in oats?

There is no ETF that offers pure-play exposure to oat prices. There are several ETFs in the grain sector such as:




These are agricultural commodity ETFs.

18. Where can I find news about oats futures?

Here is a good source for oats news.

19. What factors affect prices?

There are many factors that affect the pricing of oat futures contracts, which an oat futures trader must watch out for. Here are some of them:

Weather conditions: Though less sensitive to weather situations than wheat, oat production can be affected by weather events. Adverse weather conditions, such as drought or a prolonged freeze, may reduce production and increase oat prices, while ideal weather conditions can boost yield and bring down the price of oats.

The price of competing grains: The price of corn and other competing grains has some effects on oat prices. For quite some time now, oat prices tend to correlate with the price corn.

Demand and supply report: The USDA reports monthly data on the global production, stocks, trades, and consumption of oats. It is important for an oat trader to monitor these data for clues of demand and supply imbalances, which can affect the prices of oat contracts.

20. Are oats a commodity?

Yes, oats are a commodity.

21. What is the all time high of oats?

Historically, Oat reached an all-time high of 811 in April of 2022.

22. What country produces most oats?

Here are the top 5 counties that produces most oats.

Oats are grown in the temperate regions of the world. According to the United States Department of Agriculture (USDA), the top producers include the EU-27, Russia, Canada, Australia, the United States, Brazil, China, Belarus, Ukraine, Chile, Argentina, and Kazakhstan. Canada, Australia, the EU, and Russia are the largest exporters.

In terms of consumption, the EU tops the list of oat consumers, followed by Russia, United States, Canada, China, Brazil, Australia, Belarus, Ukraine, Argentina, and Norway. The US is the biggest importer of oats. Other big importers are China, Mexico, Norway, and Japan. Oat futures contracts are the most popular means of trading the commodity.

23. How do you trade oat futures?

You can trade them as futures, options, CFDs or ETFs on exchanges.

24. What is the seasonality of oats?

Here is a seasonal Chart of the market:

Oats Seasonality

One aspect that people may not know about oats futures seasonality is that it is heavily influenced by weather conditions. Oats are a cool-season crop that is typically planted in the spring and harvested in the fall. Any adverse weather conditions during these critical growth stages can have a significant impact on the yield and quality of the crop, which in turn can affect the price of oats futures.

Another aspect that people may not know is that oats futures are also influenced by demand from the livestock industry. Oats are a popular feed grain for livestock, and changes in the demand for meat and dairy products can affect the demand for oats. Additionally, global trade and export markets can also impact the price of oats futures as countries may increase or decrease their imports of oats depending on their own crop yields and production.

Lastly, another factor that people may not know is that oats futures may also be influenced by the price of other grains such as wheat and corn. As farmers may decide to plant other grains if the prices are more favorable, the demand for oats may decrease, and in turn, this can affect the price of oats futures.

Overall, the price of oats futures is influenced by a variety of factors, and it is essential to keep an eye on weather conditions, demand from the livestock industry, global trade, and the prices of other grains to have a better understanding of the seasonality of oats futures.

25. What are oats classed as?

Oats, formally named Avena sativa, is a type of cereal grain from the Poaceae grass family of plants.

26. Is Oats a bet against inflation?

Yes, buying oats can be a way to bet on higher inflation.

Food is the most basic and fundamental necessity. Oats prices could see large increases in prices due to higher inflation.

27. Is it risky to trade oats?

Here are 2 things that give Oat trading a higher risk

  • Overproduction of oats could cause prices to slump.
  • A global slowdown could reduce demand.
  • A sustained drop in the price of other grains could lower demand for oats.

28. Uses of Oats

Oat futures are popular on the commodity market because the grain can be used to make a wide variety of products. Here are some of them:

Steel-cut oats: Also known as Irish oatmeal, steel-cut oats are groats of whole oats that have been cut into two or three pieces.

Whole oat groats:  These are oat grains that have been dehulled and treated to denature the enzymes. Their bran layer is still intact, so they are rich in fiber.

Whole oat flour: Made from whole oat grains, whole oat flour has a high protein and fiber content.

Low-bran oat flour: The flour is made with oats whose bran layer has been removed, so it has lower protein and fiber content.

Rolled oats: These are rolled whole oat groats that are cut into various thickness

Instant rolled oats: Quick and instant rolled oats are made from steel cut oat groats.

Baked oat products: Oats are also used in a variety of baked foods, such as oat bread, oatcakes, and oat cookies.

Cosmetic products: Oat extracts have a soothing effect on the skin, so they are used in certain cosmetic products.

Final thoughs

Oats are a source of food for both humans and animals. The extracts are used in cosmetics for their skin-soothing effects. Oat futures contracts are traded on the CME.

Oats are cereal grains derived from the seeds of the oat plant. They are not only grown for human consumption — in the form of oatmeal and rolled oats — but also are one of the most common sources of livestock feed.

Wild oats futures market has been growing in the Fertile Crescent of the Near East since about 12,000 BC but were initially seen as a weed. They would later become domesticated in the Middle East and Europe during the Bronze Age, making oats one of the last grain crops to be domesticated.

Today, global oat production is more than 26 million tonnes per annum. Due to its importance as a source of human and animal food, oats futures contracts are widely traded on commodity exchanges.



What are Oat Futures?

Oat futures refer to standardized, exchange-traded contracts allowing traders to buy or sell a specific quantity of oats at a predetermined price on a future date. These contracts provide a means for managing price risk and speculating on oats market movements.

How are Oats Traded?

Oat futures contracts are traded on the Chicago Mercantile Exchange (CME) through the Globex electronic trading platform. Each contract represents 5,000 bushels of oats, and prices are quoted in cents per bushel. Traders can participate from any part of the world.

How Do You Start Trading Oat Futures?

To start trading oat futures, create an account with the exchange through a futures broker and deposit the required margin. Oat futures are leveraged instruments, allowing traders to control a larger contract value with a smaller upfront investment.

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