1. Price Risk: The most significant risk in commodity trading is price risk, which is the fluctuation in commodity prices due to supply and demand factors, geopolitical events, and macroeconomic conditions.

2. Liquidity Risk: Illiquid markets can make it difficult to buy or sell commodities quickly and at a fair price, resulting in large price movements.

3. Counterparty Risk: The risk that the other party involved in the trade (buyer or seller) defaults on their obligations.

4. Market Volatility: Commodity prices can be highly volatile, resulting in significant price swings in a short period.

5. Leverage Risk: Margin trading (using borrowed money) can amplify losses as well as profits.

6. Basis Risk: The difference between the price of a commodity on the exchange and the price in the physical market.

7. Storage Risk: The cost and risk of storing physical commodities, including damage, deterioration, and theft.

8. Transportation Risk: The risk of damage or loss during transportation.

9. Regulatory Risk: Changes in regulations or laws can affect commodity trading.

10. Natural Disaster Risk: Natural disasters, such as hurricanes or droughts, can impact commodity production and prices.

11. Geopolitical Risk: Political instability, trade wars, or sanctions can disrupt commodity supply lines and prices.

12. Currency Risk: Fluctuations in currency exchange rates can affect commodity prices.

To manage these risks, traders and investors use various strategies, such as:

• Hedging

• Diversification

• Stop-loss orders

• Position sizing

• Risk-reward ratios

• Fundamental and technical analysis

• Insurance

• Storage and transportation management

It's essential to understand and manage these risks to ensure successful commodity trading.