We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What is a Shipping Certificate?

Malcolm Tatum
Updated May 16, 2024
Our promise to you
SmartCapitalMind is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At SmartCapitalMind, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject-matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

The shipping certificate is a document that serves as a negotiable instrument in deals involving futures exchanges. Certificates of this type are issued by facilities that are approved by the exchanges involved, and serves as a means of confirming the commitment of the facility to deliver the commodity identified in the document to the certificate holder in accordance with the terms specified within the shipping certificate. Shipping certification is often utilized with commodities like wheat, corn, soybeans and even products like plywood.

One of the characteristics that makes the shipping certificate a little different from other types of guarantees of delivery is that the document does not require the approved delivery facility to actually store the commodity until the delivery date arrives. This provides the opportunity for the delivery to be fulfilled with the use of future production of the commodity, with harvesting taking place shortly before the futures date, and allowing the commodity to be transported to the shipping certificate holder in a timely manner.

This is in contrast to a similar document that is sometimes used with futures investments, known as the warehouse receipt. In this situation, the facility does store the commodity until the day it is to be delivered to the holder of the receipt. The commodity is actually in hand at the time the futures contract is created, remains in storage for the life of the contract, and is shipped to the location supplied by the investor on the agreed upon delivery date.

One of the benefits associated with commodities investments that make use of the shipping certificate is that there is no need for the commodities to actually exist at the time the futures contract is created. The contract may be based on the projected amount of the commodity that will be produced by the delivery date. For example, if an investor anticipates that the demand for corn will substantially increase at a certain point in the future, he or she may create a futures contract for the commodity, effectively purchasing the commodity at a lower price today, and delaying delivery until after prices have increased substantially. This allows the investor to forego any warehousing costs that would possibly cut into the profits, while still earning a return from the increased demand. As with any investment strategy, if the projection for increased demand is inaccurate, the investor could become the owner of a commodity that is worth less than the futures price that was named in the contract, and sustain a loss instead of posting a profit.

SmartCapitalMind is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Malcolm Tatum
By Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing to become a full-time freelance writer. He has contributed articles to a variety of print and online publications, including SmartCapitalMind, and his work has also been featured in poetry collections, devotional anthologies, and newspapers. When not writing, Malcolm enjoys collecting vinyl records, following minor league baseball, and cycling.
Discussion Comments
By anon1004169 — On Dec 03, 2020

Nice information.

Malcolm Tatum
Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing...
Learn more
SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.

SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.