Futures premium: When the price of commodity futures is higher than the spot price, people are willing to pay more than the actual expected price for this commodity at a certain point, which may be because people are more willing to pay more premium to buy this commodity in the future, rather than spend the cost to store this commodity now. When there is little or no convenient income, the futures price is higher than the spot price.

2. Forward (spot premium):?

In order to better understand the futures premium and spot premium, first explain the convenience income, which refers to the income obtained by holding the target product or physical product. For example, if you buy a lot of wheat, when the drought comes, the demand for wheat increases, then the difference between the initial wheat purchase price and the increased wheat price this time is the convenience income. Generally speaking, the convenience benefit is inversely proportional to the storage difficulty. If the physical object is easy to store, the forward price will fall, and vice versa.