What does 'delivery' refer to in the context of commodity futures?

In the context of commodity futures, 'delivery' specifically refers to the process of transferring physical commodities from the seller to the buyer at the contract's expiration. This is a critical aspect of futures trading, as it embodies the actual fulfillment of the contract terms. When a futures contract is settled by delivery, the seller is obligated to provide the specified quantity and quality of the commodity to the buyer, who must then take possession. This physical transfer is what differentiates futures contracts that lead to actual delivery from those that may be settled financially.

In contrast, the price adjustment at expiration pertains to financial settlements but does not involve the actual exchange of physical goods. A report on commodity performance would provide insights and analytics on market behavior and trends but is unrelated to the transactional operations of futures contracts. Lastly, the agreement between buyer and seller outlines the terms and conditions of the trade but does not encompass the operational aspect of physically delivering the commodity itself. Thus, delivery is fundamentally about the actual transfer of ownership of the commodity involved in the contract.