We propose a simple model which offers a unified theoretical framework for the analysis of price and quantity relationships in commodity markets. We study the simultaneous equilibrium in the physical and futures markets. We demonstrate the existence and uniqueness of this equilibrium and we provide explicit expressions. We provide insights into the hedging function of the futures market and the informational role of prices. The model is particularly efficient for precise qualitative and quantitative comparative statics. Among other possibilities, we compare equilibrium variables with and without futures markets and we show that the level and volatility of spot prices increases with the number of speculators. We also provide neat predictions on the political economy of potential reforms of market structure.