Edgar Filing: Teucrium Commodity Trust

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 2016.

☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to .

Commission File Number: 001-34765

Teucrium Commodity Trust

(Exact name of registrant as specified in its charter)

Delaware	61-1604335
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

232 Hidden Lake Road, Building A

Brattleboro, Vermont 05301

(Address of principal executive offices) (Zip code)

(802) 257-1617

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐		Accelerated filer ☒
Non-accelerated filer ☐		Smaller reporting company ☐
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the last practicable date.

	Total Number of Outstanding Shares as of November 7, 2016
Teucrium Corn Fund	4,725,004
Teucrium Sugar Fund	500,004
Teucrium Soybean Fund	725,004
Teucrium Wheat Fund	8,650,004
Teucrium Agricultural Fund	50,002

TEUCRIUM COMMODITY TRUST

Table of Contents

	Page
Part I. FINANCIAL INFORMATION

Item 1. Financial Statements.	3

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	98

Item 3. Quantitative and Qualitative Disclosures About Market Risk.	127

Item 4. Controls and Procedures.	130

Part II. OTHER INFORMATION

Item 1. Legal Proceedings.	130

Item 1A. Risk Factors.	130

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	144

Item 3. Defaults Upon Senior Securities.	146

Item 4. Mine Safety Disclosures.	146

Item 5. Other Information.	146

Item 6. Exhibits.	146

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements.

Index to Financial Statements

Documents		Page
TEUCRIUM COMMODITY TRUST

Combined Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		5

Combined Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		6

Combined Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		8

Combined Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		9

Combined Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		10

Notes to Combined Financial Statements		11

TEUCRIUM CORN FUND

Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		22

Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		23

Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		25

Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		26

Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		27

Notes to Financial Statements		28

TEUCRIUM SOYBEAN FUND

Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		37

Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		38

Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		40

Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		41

Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		42

Notes to Financial Statements		43

TEUCRIUM SUGAR FUND

Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		53

Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		54

Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		56

Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		57

Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		58

Notes to Financial Statements		59

TEUCRIUM WHEAT FUND

Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		69

Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		70

Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		72

Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		73

Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		74

Notes to Financial Statements		75

TEUCRIUM AGRICULTURAL FUND

Statements of Assets and Liabilities at September 30, 2016 (Unaudited) and December 31, 2015		85

Schedule of Investments at September 30, 2016 (Unaudited) and December 31, 2015		86

Statements of Operations (Unaudited) for the three and nine months ended September 30, 2016 and 2015		88

Statements of Changes in Net Assets (Unaudited) for the nine months ended September 30, 2016 and 2015		89

Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2016 and 2015		90

Notes to Financial Statements		91

TEUCRIUM COMMODITY TRUST

COMBINED STATEMENTS OF ASSETS AND LIABILITIES

	September 30, 2016		December 31, 2015
	(Unaudited)
Assets
Cash and cash equivalents	$	141,326,273	$	92,561,610
Interest receivable		17,904		776
Restricted cash		190,684		307,683
Other assets		779,538		723,450
Equity in trading accounts:
Commodity futures contracts		842,786		380,231
Due from broker		17,512,696		11,790,423
Total equity in trading accounts		18,355,482		12,170,654
Total assets		160,669,881		105,764,173

Liabilities
Management fee payable to Sponsor		128,082		82,863
Other liabilities		1,213		8,147
Payable for Shares redeemed		541,380		-
Equity in trading accounts:
Commodity futures contracts		7,169,483		6,071,676
Due to broker		250,600		-
Total equity in trading accounts		7,420,083		6,071,676
Total liabilities		8,090,758		6,162,686

Net assets	$	152,579,123	$	99,601,487

The accompanying notes are an integral part of these financial statements.

TEUCRIUM COMMODITY TRUST

COMBINED SCHEDULE OF INVESTMENTS

September 30, 2016

(Unaudited)

Description: Assets	Fair Value		Percentage of Net Assets		Shares
Cash equivalents
Money market funds
Fidelity Institutional Money Market Funds - Government Portfolio (cost $2,050,664)	$	2,050,664	1.34	%		2,050,664

					Notional Amount
					(Long Exposure)

Commodity futures contracts
United States soybean futures contracts
CBOT soybean futures NOV17 (99 contracts)	$	143,413	0.09	%	$	4,718,588

United States sugar futures contracts
ICE sugar futures MAY17 (103 contracts)		213,730	0.14			2,556,378
ICE sugar futures MAR18 (113 contracts)		485,643	0.32			2,575,496
Total commodity futures contracts	$	842,786	0.55	%	$	9,850,462

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States corn futures contracts
CBOT corn futures MAR17 (1,561 contracts)	$	1,109,538		0.73	%	$	27,044,325
CBOT corn futures MAY17 (1,311 contracts)		206,550		0.14			23,171,925
CBOT corn futures DEC17 (1,433 contracts)		1,404,300		0.92			26,976,225

United States soybean futures contracts
CBOT soybean futures JAN17 (98 contracts)		355,200		0.23			4,700,325
CBOT soybean futures MAR17 (83 contracts)		31,800		0.02			4,006,825

United States sugar futures contracts
ICE sugar futures JUL17 (92 contracts)		29,882		0.02			2,195,782

United States wheat futures contracts
CBOT wheat futures MAR17 (900 contracts)		1,886,900		1.24			19,113,750
CBOT wheat futures MAY17 (748 contracts)		158,638		0.10			16,381,200
CBOT wheat futures DEC17 (797 contracts)		1,986,675		1.30			19,147,925
Total commodity futures contracts	$	7,169,483		4.70	%	$	142,738,282

						Shares
Exchange-traded funds*
Teucrium Corn Fund	$	338,765		0.22	%		18,108
Teucrium Soybean Fund		326,741		0.21			17,631
Teucrium Sugar Fund		359,372		0.24			24,524
Teucrium Wheat Fund		329,886		0.22			45,887
Total exchange-traded funds (cost $2,065,066)	$	1,354,764		0.89	%

*The Trust eliminates the shares owned by the Teucrium Agricultural Fund from its combined statements of assets and liabilities due to the fact that these represent holdings of the Underlying Funds owned by the Teucrium Agricultural Fund, which are included as shares outstanding of the Underlying Funds.

The accompanying notes are an integral part of these financial statements.

TEUCRIUM COMMODITY TRUST

COMBINED SCHEDULE OF INVESTMENTS

December 31, 2015

			Percentage of
Description: Assets	Fair Value		Net Assets			Shares

Cash equivalents
Money market funds
Fidelity Institutional Prime Money Market Portfolio (cost $2,539,642)	$	2,539,642		2.55	%		2,539,642

						Notional Amount
						(Long Exposure)
Commodity futures contracts
United States soybean futures contracts
CBOT soybean futures MAY16 (45 contracts)	$	16,175		0.02	%	$	1,956,375

United States sugar futures contracts
ICE sugar futures MAY16 (115 contracts)		151,973		0.15			1,921,696
ICE sugar futures JUL16 (101 contracts)		199,517		0.20			1,656,077
ICE sugar futures MAR17 (114 contracts)		12,566		0.01			1,927,968
Total commodity futures contracts	$	380,231		0.38	%	$	7,462,116

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States corn futures contracts
CBOT corn futures MAY16 (1,172 contracts)	$	1,910,013		1.92	%	$	21,359,700
CBOT corn futures JUL16 (988 contracts)		925,750		0.93			18,302,700
CBOT corn futures DEC16 (1,117 contracts)		1,072,787		1.08			21,390,550

United States soybean futures contracts
CBOT soybean futures MAR16 (52 contracts)		30,075		0.03			2,247,050
CBOT soybean futures NOV16 (52 contracts)		208,587		0.21			2,295,150

United States wheat futures contracts
CBOT wheat futures MAY16 (390 contracts)		379,713		0.38			9,291,750
CBOT wheat futures JUL16 (330 contracts)		331,313		0.33			7,973,625
CBOT wheat futures DEC16 (366 contracts)		1,213,438		1.22			9,287,250
Total commodity futures contracts	$	6,071,676		6.10	%	$	92,147,775

Exchange-traded funds*						Shares
Teucrium Corn Fund	$	326,157		0.33	%		15,538
Teucrium Soybean Fund		331,730		0.33			19,131
Teucrium Sugar Fund		345,281		0.35			34,474
Teucrium Wheat Fund		321,433		0.32			35,137
Total exchange-traded funds (cost $2,126,379)	$	1,324,601		1.33	%

TEUCRIUM COMMODITY TRUST

COMBINED STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Income
Realized and unrealized gain (loss) on trading of commodity futures contracts:
Realized loss on commodity futures contracts	$	(11,187,329	)	$	(1,464,716	)	$	(13,175,344	)	$	(9,640,928	)
Net change in unrealized appreciation or depreciation on commodity futures contracts		(1,385,513	)		(12,999,597	)		(635,252	)		(5,469,783	)
Interest Income		207,383			80,676			483,009			122,964
Total loss		(12,365,459	)		(14,383,637	)		(13,327,587	)		(14,987,747	)

Expenses
Management fees		380,847			298,551			902,344			879,464
Professional fees		438,651			298,053			986,600			910,602
Distribution and marketing fees		721,439			525,681			1,690,002			1,161,981
Custodian fees and expenses		88,672			326,798			223,961			618,612
Business permits and licenses fees		28,854			10,125			72,322			77,246
General and administrative expenses		60,148			88,520			173,288			224,722
Brokerage commissions		30,802			5,351			82,213			36,775
Other expenses		27,362			17,771			67,982			45,367
Total expenses		1,776,775			1,570,850			4,198,712			3,954,769

Expenses waived by the Sponsor		(304,726	)		(369,619	)		(403,282	)		(681,386	)

Total expenses, net		1,472,049			1,201,231			3,795,430			3,273,383

Net loss	$	(13,837,508	)	$	(15,584,868	)	$	(17,123,017	)	$	(18,261,130	)

The accompanying notes are an integral part of these financial statements.

TEUCRIUM COMMODITY TRUST

COMBINED STATEMENTS OF CHANGES IN NET ASSETS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Operations
Net loss	$	(17,123,017	)	$	(18,261,130	)
Capital transactions
Issuance of Shares		97,154,354			29,655,798
Redemption of Shares		(27,059,248	)		(47,316,245	)
Net change in the cost of the Underlying Funds		5,547			2
Total capital transactions		70,100,653			(17,660,445	)

Net change in net assets		52,977,636			(35,921,575	)

Net assets, beginning of period		99,601,487			145,351,972

Net assets, end of period	$	152,579,123		$	109,430,397

The accompanying notes are an integral part of these financial statements.

TEUCRIUM COMMODITY TRUST

COMBINED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Cash flows from operating activities:
Net loss	$	(17,123,017	)	$	(18,261,130	)
Adjustments to reconcile net loss to net cash used in operating activities:
Net change in unrealized appreciation or depreciation on commodity futures contracts		635,252			5,469,783

Changes in operating assets and liabilities:
Due from broker		(5,722,273	)		(8,858,210	)
Interest receivable		(17,128	)		8,961
Restricted cash		116,999			(381,462	)
Other assets		(56,088	)		(443,833	)
Due to broker		250,600			(60,805	)
Management fee payable to Sponsor		45,219			(44,649	)
Other liabilities		(6,934	)		(129,504	)
Net cash used in operating activities		(21,877,370	)		(22,700,849	)

Cash flows from financing activities:
Proceeds from sale of Shares		97,154,354			29,655,798
Redemption of Shares		(26,517,868	)		(49,312,430	)
Net change in cost of the Underlying Funds		5,547			2
Net cash provided by (used in) financing activities		70,642,033			(19,656,630	)

Net change in cash and cash equivalents		48,764,663			(42,357,479	)
Cash and cash equivalents, beginning of period		92,561,610			142,423,637
Cash and cash equivalents, end of period	$	141,326,273		$	100,066,158

The accompanying notes are an integral part of these financial statements.

NOTES TO COMBINED FINANCIAL STATEMENTS

September 30, 2016

(Unaudited)

Note 1 – Organization and Operation

Teucrium Commodity Trust (“Trust”), a Delaware statutory trust organized on September 11, 2009, is a series trust consisting of five series: Teucrium Corn Fund (“CORN”), Teucrium Sugar Fund (“CANE”), Teucrium Soybean Fund (“SOYB”), Teucrium Wheat Fund (“WEAT”), and Teucrium Agricultural Fund (“TAGS”). All these series of the Trust are collectively referred to as the “Funds” and singularly as the “Fund.” The Funds issue common units, called the “Shares,” representing fractional undivided beneficial interests in a Fund. The Trust and the Funds operate pursuant to the Trust’s Second Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). Two additional series, the Teucrium Natural Gas Fund (“NAGS”) and the Teucrium WTI Crude Oil Fund (“CRUD”) commenced operations in 2011; these, however, ceased trading and were deregistered effective with the close of trading on December 18, 2014. Liquidation of NAGS and CRUD was completed prior to December 31, 2014 and the Form 15 was filed on January 9, 2015.

On June 5, 2010, the initial Form S-1 for CORN was declared effective by the U.S. Securities and Exchange Commission (“SEC”). On June 8, 2010, four Creation Baskets for CORN were issued representing 200,000 shares and $5,000,000. CORN began trading on the New York Stock Exchange (“NYSE”) Arca on June 9, 2010. On April 29, 2016 a subsequent registration statement for CORN was declared effective by the SEC.

On June 17, 2011, the initial Forms S-1 for CANE, SOYB, and WEAT were declared effective by the SEC. On September 16, 2011, two Creation Baskets were issued for each Fund, representing 100,000 shares and $2,500,000, for CANE, SOYB, and WEAT. On September 19, 2011, CANE, SOYB, and WEAT started trading on the NYSE Arca. On June 30, 2014, subsequent registration statements for CANE, SOYB and WEAT were declared effective by the SEC. On July 15, 2016, a subsequent registration statement for WEAT was declared effective. This registration statement for WEAT registered an additional 24,050,000 shares.

On February 10, 2012, the Form S-1 for TAGS was declared effective by the SEC. On March 27, 2012, six Creation Baskets for TAGS were issued representing 300,000 shares and $15,000,000. TAGS began trading on the NYSE Arca on March 28, 2012. On April 30, 2015, a subsequent registration statement for TAGS was declared effective by the SEC.

The specific investment objective of each Fund and information regarding the organization and operation of each Fund are included in each Fund’s financial statements and accompanying notes, as well as in other sections of this Form 10-Q filing. In general, the investment objective of each Fund is to have the daily changes in percentage terms of its Shares’ Net Asset Value (“NAV”) reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for certain Futures Contracts for the commodity specified for that Fund. The investment objective of TAGS is to have the daily changes in percentage terms of NAV of its common units (“Shares”) reflect the daily changes in percentage terms of a weighted average (the “Underlying Fund Average”) of the NAVs per share of four other commodity pools that are series of the Trust and are sponsored by the Sponsor: CORN, WEAT, SOYB, and CANE (collectively, the “Underlying Funds”). The Underlying Fund Average will have a weighting of 25% to each Underlying Fund, and the Fund’s assets will be rebalanced to maintain the approximate 25% allocation to each Underlying Fund.

The accompanying unaudited financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X promulgated by the SEC and, therefore, do not include all information and footnote disclosures required under accounting principles generally accepted in the United States of America (“GAAP”). The financial information included herein is unaudited; however, such financial information reflects all adjustments which are, in the opinion of management, necessary for the fair presentation of the Trust’s financial statements for the interim period. It is suggested that these interim financial statements be read in conjunction with the financial statements and related notes included in the Trust’s Annual Report on Form 10-K, as applicable. The operating results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016.

Subject to the terms of the Trust Agreement, Teucrium Trading, LLC in its capacity as the Sponsor ("Sponsor") may terminate a Fund at any time, regardless of whether the Fund has incurred losses, including, for instance, if it determines that the Fund’s aggregate net assets in relation to its operating expenses make the continued operation of the Fund unreasonable or imprudent. However, no level of losses will require the Sponsor to terminate a Fund.

Note 2 – Principal Contracts and Agreements

On August 17, 2015 (the “Conversion Date”), U.S. Bank N.A. replaced The Bank of New York Mellon as the Custodian for the Funds. The principal business address for U.S. Bank N.A. is 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. U.S. Bank N.A. is a Wisconsin state chartered bank subject to regulation by the Board of Governors of the Federal Reserve System and the Wisconsin State Banking Department. The principal address for U.S. Bancorp Fund Services, LLC (“USBFS”) is 777 East Wisconsin Avenue, Milwaukee, WI, 53202. In addition, effective on the Conversion Date, USBFS, a wholly owned subsidiary of U.S. Bank, commenced serving as administrator for each Fund, performing certain administrative and accounting services and preparing certain SEC reports on behalf of the Funds, and also became the registrar and transfer agent for each Fund’s Shares. For such services, U.S. Bank and USBFS will receive an asset-based fee, subject to a minimum annual fee.

Given this conversion, beginning with the quarter ended June 30, 2015 and for the year-ended December 31, 2015, the combined statements of operations reflected an expense, before and after fees waived by the Sponsor, for fees associated with Custodian, Fund Administration and Transfer Agent services (“Custodian Fees”) that have or will be paid to the Bank of New York Mellon by a Fund or by the Sponsor on behalf of a Fund. The Custodian Fees reflected in the financial statements through December 31, 2015, net of expenses waived by the Sponsor, are generally as had been presented in prior periods of 2015.

For custody services, the Funds will pay to U.S. Bank N.A. 0.0075% of average gross assets up to $1 billion, and .0050% of average gross assets over $1 billion, annually, plus certain per-transaction charges. For Transfer Agency, Fund Accounting and Fund Administration services, which are based on the total assets for all the Funds in the Trust, the Funds will pay to USBFS 0.06% of average gross assets on the first $250 million, 0.05% on the next $250 million, 0.04% on the next $500 million and 0.03% on the balance over $1 billion annually. A combined minimum annual fee of up to $64,500 for custody, transfer agency, accounting and administrative services is assessed per Fund. For the three months ended September 30, 2016 and 2015, the Funds recognized $88,672 and $326,798, respectively, for these services, which were recorded in custodian fees and expenses on the combined statements of operations; of these expenses $4,471 in 2016 and $257,550 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Funds recognized $223,961 and $618,612, respectively, for these services, which were recorded in custodian fees and expenses on the combined statements of operations; of these expenses $11,515 in 2016 and $445,550 in 2015 were waived by the Sponsor.

The Sponsor employs Foreside Fund Services, LLC (“Foreside” or the “Distributor”) as the Distributor for the Funds. The Distribution Services Agreement among the Distributor and the Sponsor calls for the Distributor to work with the Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials. The Distributor and the Sponsor have also entered into a Securities Activities and Service Agreement (the “SASA”) under which certain employees and officers of the Sponsor are licensed as registered representatives or registered principals of the Distributor, under Financial Industry Regulatory Authority (“FINRA”) rules. For its services as the Distributor, Foreside receives a fee of 0.01% of the Fund’s average daily net assets and an aggregate annual fee of $100,000 for all Teucrium Funds, along with certain expense reimbursements. For its services under the SASA, Foreside receives a fee of $5,000 per registered representative and $1,000 per registered location. For the three months ended September 30, 2016 and 2015, the Funds recognized $36,423 and $34,805, respectively, for these services, which was recorded in distribution and marketing fees on the combined statements of operations; of these expenses $1,829 in 2016 and $1,922 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Funds recognized $110,466 and $112,554, respectively, for these services, which was recorded in distribution and marketing fees on the combined statements of operations; of these expenses $4,822 in 2016 and $5,617 in 2015 were waived by the Sponsor.

On January 2, 2015, Newedge USA, LLC (“Newedge USA”) merged with and into SG Americas Securities, LLC (“SG”), with the latter as the surviving entity. On February 6, 2015 Jefferies LLC (“Jefferies”) became the Funds’ FCM and primary clearing broker. All futures contracts held by SG were transferred to Jefferies on that date. As of February 23, 2015 all residual cash balances held at SG had been transferred to Jefferies and the balance in all SG accounts was $0. Effective June 3, 2015, ED&F Man Capital Markets Inc. (“ED&F Man”) replaced Jefferies as the Underlying Funds’ FCM and the clearing broker to execute and clear the Underlying Fund’s futures and provide other brokerage-related services. As of June 4, 2015 all futures contracts and residual cash balances held at Jefferies had been transferred to ED&F Man and the balance in all Jefferies accounts was $0.

Currently, ED&F Man serves as the Underlying Funds’ clearing broker to execute and clear the Underlying Funds’ futures and provide other brokerage-related services. ED&F Man is registered as a FCM with the U.S. CFTC and is a member of the NFA. ED&F Man is also registered as a broker/dealer with the U.S. Securities and Exchange Commission and is a member of the FINRA. ED&F Man is a clearing member of ICE Futures U.S., Inc., Chicago Board of Trade, Chicago Mercantile Exchange, New York Mercantile Exchange, and all other major United States commodity exchanges. For Corn, Soybean, Sugar and Wheat Futures Contracts ED&F Man, Jefferies and SG were paid $8.00 per round turn. Effective January 1, 2016, ED&F Man, increased the per round-term charge for futures contracts commission to $9.00. For the three months ended September 30, 2016 and 2015, the Funds recognized $30,802 and $5,351, respectively, for these services, which are recorded in brokerage commissions on the combined statements of operations and was paid by the Funds. For the nine months ended September 30, 2016 and 2015, the Funds recognized $82,213 and $36,775, respectively, for these services, which are recorded in brokerage commissions on the combined statements of operations and was paid by the Funds.

The sole Trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation. The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory Trust Act. For its services, the Trustee receives an annual fee of $3,300 from the Trust. For the three and nine months ended September 30, 2016, the Funds recognized $3,039 for these services which are recorded in business permits and licenses on the combined statements of operations and was waived by the Sponsor. For the three and nine months ended September 30, 2015, the Funds did not recognize any expense for these services.

Note 3 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying financial statements have been prepared on a combined basis in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as detailed in the Financial Accounting Standards Board’s Accounting Standards Codification and include the accounts of the Trust, CORN, CANE, SOYB, WEAT and TAGS. Refer to the accompanying separate financial statements for each Fund for more detailed information. For the periods represented by the financial statements herein the operations of the Trust contain the results

of CORN, SOYB, CANE, WEAT, and TAGS except for eliminations for TAGS as explained below for the months during which each Fund was in operation.

Given the investment objective of TAGS as described in Note 1 above, TAGS will buy, sell and hold, as part of its normal operations, shares of the four Underlying Funds. The Trust eliminates the shares of the other series of the Trust owned by the Teucrium Agricultural Fund from its combined statements of assets and liabilities. The Trust eliminates the net change in unrealized appreciation or depreciation on securities owned by the Teucrium Agricultural Fund from its combined statements of operations. The combined statements of changes in net assets and cash flows present a net presentation of the purchases and sales of the Underlying Funds of TAGS.

Revenue Recognition

Commodity futures contracts are recorded on the trade date. All such transactions are recorded on the identified cost basis and marked to market daily. Unrealized appreciation or depreciation on commodity futures contracts are reflected in the statements of operations as the difference between the original contract amount and the fair market value as of the last business day of the year or as of the last date of the financial statements. Changes in the appreciation or depreciation between periods are reflected in the statements of operations. Interest on cash equivalents and deposits with the Futures Commission Merchant are recognized on the accrual basis. The Funds earn interest on its assets denominated in U.S. dollars on deposit with the Futures Commission Merchant. In addition, the Funds earn interest on funds held at the custodian at prevailing market rates for such investments.

Brokerage Commissions

Brokerage commissions on all open commodity futures contracts are accrued on the trade date and on a full-turn basis.

Income Taxes

The Trust, as a Delaware statutory trust, is considered a trust for federal tax purposes and is, thus, a pass through entity. For tax purposes, the Funds will be treated as partnerships. Therefore, the Funds do not record a provision for income taxes because the shareholders report their share of a Fund’s income or loss on their income tax returns. The financial statements reflect the Funds’ transactions without adjustment, if any, required for income tax purposes.

The Funds are required to determine whether a tax position is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Funds file income tax returns in the U.S. federal jurisdiction, and may file income tax returns in various U.S. states and foreign jurisdictions. For all tax years 2013 to 2015, the Funds remain subject to income tax examinations by major taxing authorities. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. De-recognition of a tax benefit previously recognized results in the Funds recording a tax liability that reduces net assets. Based on their analysis, the Funds have determined that they have not incurred any liability for unrecognized tax benefits as of September 30, 2016 and for the years ended December 31, 2015, 2014 and 2013. However, the Funds’ conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, ongoing analysis of and changes to tax laws, regulations, and interpretations thereof.

The Funds recognize interest accrued related to unrecognized tax benefits and penalties related to unrecognized tax benefits in income tax fees payable, if assessed. No interest expense or penalties have been recognized as of and for the nine months ended September 30, 2016 and 2015.

The Funds may be subject to potential examination by U.S. federal, U.S. state, or foreign jurisdictional authorities in the area of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions, and compliance with U.S. federal, U.S. state and foreign tax laws. The Funds’ management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

Creations and Redemptions

Authorized Purchasers may purchase Creation Baskets from each Fund. The amount of the proceeds required to purchase a Creation Basket will be equal to the NAV of the shares in the Creation Basket determined as of 4:00 p.m. New York time on the day the order to create the basket is properly received.

Authorized Purchasers may redeem shares from each Fund only in blocks of shares called “Redemption Baskets.” The amount of the redemption proceeds for a Redemption Basket will be equal to the NAV of the shares in the Redemption Basket determined as of 4:00 p.m. New York time on the day the order to redeem the basket is properly received.

Each Fund receives or pays the proceeds from shares sold or redeemed within three business days after the trade date of the purchase or redemption. The amounts due from Authorized Purchasers are reflected in the statements of assets and liabilities as receivable for shares sold. Amounts payable to Authorized Purchasers upon redemption are reflected in the statements of assets and liabilities as payable for shares redeemed.

There are a minimum number of baskets and associated shares specified for each Fund in the Fund’s respective prospectus, as amended from time to time. Once the minimum number of baskets is reached, there can be no more redemptions until there has been a creation basket. These minimum levels are as follows:

CORN: 50,000 shares representing 2 baskets

SOYB: 50,000 shares representing 2 baskets

CANE: 50,000 shares representing 2 baskets

WEAT: 50,000 shares representing 2 baskets

TAGS: 50,000 shares representing 2 baskets (at minimum level as of September 30, 2016 and December 31, 2015)

Cash Equivalents

Cash equivalents are highly-liquid investments with maturity dates of 90 days or less when acquired. The Trust reported its cash equivalents in the combined statements of assets and liabilities at market value, or at carrying amounts that approximate fair value, because of their highly-liquid nature and short-term maturities. Each Fund that is a series of the Trust has the balance of its assets on deposit with banks. The Trust had a balance of $2,050,664 and $2,539,642 in money market funds at September 30, 2016 and December 31, 2015, respectively; these balances are included in cash and cash equivalents on the combined statements of assets and liabilities. Effective in the second quarter 2015, the Sponsor invested a portion of the available cash for the Funds in alternative demand-deposit savings accounts, which is classified as cash and not as cash equivalents. The Funds had a balance of $139,275,609 on September 30, 2016 and $90,021,968 on December 31, 2015 in demand-deposit savings accounts. This change resulted in a reduction in the balance held in money market funds. Assets deposited with the bank may, at times, exceed federally insured limits.

Restricted Cash

On August 17, 2015 (the “Conversion Date”), U.S. Bank N.A. replaced The Bank of New York Mellon as the Custodian for the Funds. Per the amended agreement between the Sponsor and The Bank of New York Mellon dated August 14, 2015, certain cash amounts for each Fund, except in the case of TAGS, are to remain at The Bank of New York Mellon until amounts for services and early termination fees are paid. The amended agreement allows for payments for such amounts owed to be made through December 31, 2017. Cash balances that are held in custody at The Bank of New York Mellon under this amended agreement are reflected on the combined statements of assets and liabilities of the Fund and the Trust as restricted cash.

Due from/to Broker

The amount recorded by the Trust for the amount due from and to the clearing broker includes, but is not limited to, cash held by the broker, amounts payable to the clearing broker related to open transactions and payables for commodities futures accounts liquidating to an equity balance on the clearing broker’s records.

Margin is the minimum amount of funds that must be deposited by a commodity interest trader with the trader’s broker to initiate and maintain an open position in futures contracts. A margin deposit acts to assure the trader’s performance of the futures contracts purchased or sold. Futures contracts are customarily bought and sold on initial margin that represents a very small percentage of the aggregate purchase or sales price of the contract. Because of such low margin requirements, price fluctuations occurring in the futures markets may create profits and losses that, in relation to the amount invested, are greater than are customary in other forms of investment or speculation. As discussed below, adverse price changes in the futures contract may result in margin requirements that greatly exceed the initial margin. In addition, the amount of margin required in connection with a particular futures contract is set from time to time by the exchange on which the contract is traded and may be modified from time to time by the exchange during the term of the contract. Brokerage firms, such as the Funds’ clearing brokers, carrying accounts for traders in commodity interest contracts generally require higher amounts of margin as a matter of policy to further protect themselves. Over-the-counter trading generally involves the extension of credit between counterparties, so the counterparties may agree to require the posting of collateral by one or both parties to address credit exposure.

When a trader purchases an option, there is no margin requirement; however, the option premium must be paid in full. When a trader sells an option, on the other hand, he or she is required to deposit margin in an amount determined by the margin requirements established for the underlying interest and, in addition, an amount substantially equal to the current premium for the option. The margin requirements imposed on the selling of options, although adjusted to reflect the probability that out-of-the-money options will not be exercised, can in fact be higher than those imposed in dealing in the futures markets directly. Complicated margin requirements apply to spreads and conversions, which are complex trading strategies in which a trader acquires a mixture of options positions and positions in the underlying interest.

Ongoing or “maintenance” margin requirements are computed each day by a trader’s clearing broker. When the market value of a particular open futures contract changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the broker. If the margin call is not met within a reasonable time, the broker may close out the trader’s position. With respect to the Funds’ trading, the Funds (and not their shareholders personally) are subject to margin calls.

Finally, many major U.S. exchanges have passed certain cross margining arrangements involving procedures pursuant to which the futures and options positions held in an account would, in the case of some accounts, be aggregated, and margin requirements would be assessed on a portfolio basis, measuring the total risk of the combined positions.

Payable/Receivable for Securities Purchased/Sold

Due from/to broker for investments in securities are securities transactions pending settlement. The Trust and the Funds are subject to credit risk to the extent any broker with whom it conducts business is unable to fulfill contractual obligations on its behalf. The management of the Trust and the Funds monitors the financial condition of such brokers and does not anticipate any losses from these counterparties. Since the inception of the Fund, the principal broker through which the Trust and TAGS clear securities transactions for TAGS is the Bank of New York Mellon Capital Markets.

Sponsor Fee, Allocation of Expenses and Related Party Transactions

The Fund's sponsor, Teucrium Trading, LLC (the "Sponsor"), is responsible for investing the assets of the Funds in accordance with the objectives and policies of each Fund. In addition, the Sponsor arranges for one or more third parties to provide administrative, custodial, accounting, transfer agency and other necessary services to the Trust and the Funds. In addition, the Sponsor elected not to outsource services directly attributable to the Trust and the Funds such as accounting, financial reporting, regulatory compliance and trading activities. In addition, the Funds, except for TAGS which has no such fee, are contractually obligated to pay a monthly management fee to the Sponsor, based on average daily net assets, at a rate equal to 1.00% per annum.

The Funds pay for all brokerage fees, taxes and other expenses, including licensing fees for the use of intellectual property, registration or other fees paid to the SEC, FINRA, formerly the National Association of Securities Dealers, or any other regulatory agency in connection with the offer and sale of subsequent Shares, after its initial registration, and all legal, accounting, printing and other expenses associated therewith. The Funds also pay the fees and expenses associated with the Trust’s tax accounting and reporting requirements. Certain aggregate expenses common to all Funds within the Trust are allocated by the Sponsor to the respective Fund based on activity drivers deemed most appropriate by the Sponsor for such expenses, including but not limited to relative assets under management and creation and redeem order activity.

These aggregate common expenses include, but are not limited to, legal, auditing, accounting and financial reporting, tax-preparation, regulatory compliance, trading activities, and insurance costs, as well as fees paid to the Distributor, which are included in the related line item in the combined statements of operations. A portion of these aggregate common expenses are related to the Sponsor or related parties of principals of the Sponsor; these are necessary services to the Trust and the Funds, which are primarily the cost of performing accounting and financial reporting, regulatory compliance, and trading activities that are directly attributable to the Trust and the Funds. For the three months ended September 30, 2016 and 2015; such expenses, which are primarily recorded in distribution and marketing fees on the combined statements of operations, totaled $415,328 in 2016 and $371,374 in 2015; of these amounts, $160,317 in 2016 and $15,253 in 2015, were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015; such expenses, which are primarily recorded in distribution and marketing fees on the combined statements of operations, totaled $1,417,388 in 2016 and $1,220,938 in 2015; of these amounts, $204,372 in 2016 and $57,024 in 2015 were waived by the Sponsor. All asset-based fees and expenses for the Funds are calculated on the prior day’s net assets.

The Sponsor has the ability to elect to pay certain expenses on behalf of the Funds or waive the management fee. This election is subject to change by the Sponsor, at its discretion. Expenses paid by the Sponsor and Management fees waived by the Sponsor are, if applicable, presented as waived expenses in the statements of operations for each Fund.

For the three months ended September 30, 2016, there were $304,726 of expenses that were on the combined statements of operations of the Trust as expenses that were waived by the Sponsor. These were specifically: $134,161 for CORN, $63,113 for SOYB, $48,043 for CANE, $49,516 for WEAT and $9,893 for TAGS. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the three months ended September 30, 2015, there were $369,619 of expenses that were on the combined statements of operations of the Trust as expenses that were waived by the Sponsor. These were specifically: $16,584 for CORN, $129,551 for SOYB, $109,353 for CANE, $10,874 for WEAT and $103,257 for TAGS. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the nine months ended September 30, 2016, there were $403,282 of expenses that were on the combined statements of operations of the Trust as expenses that were waived by the Sponsor. These were specifically: $134,161 for CORN, $63,113 for SOYB, $121,429 for CANE, $49,516 for WEAT and $35,063 for TAGS. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the nine months ended September 30, 2015, there were $681,386 of expenses that were on the combined statements of operations of the Trust as expenses that were waived by the Sponsor. These were specifically: $16,584 for CORN, $243,723 for SOYB, $197,178 for CANE, $42,174 for WEAT, and $181,727 for TAGS. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of the revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value - Definition and Hierarchy

In accordance with U.S. GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

In determining fair value, the Trust uses various valuation approaches. In accordance with U.S. GAAP, a fair value hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Trust. Unobservable inputs reflect the Trust’s assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows:

Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 futures contracts held by CORN, SOYB, CANE and WEAT, the securities of the Underlying Funds held by TAGS, and any other securities held by any Fund, together referenced throughout this filing as "financial instruments." Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment.

Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The availability of valuation techniques and observable inputs can vary from financial instrument to financial instrument and is affected by a wide variety of factors including, the type of financial instrument, whether the financial instrument is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Those estimated values do not necessarily represent the amounts that may be ultimately realized due to the occurrence of future circumstances that cannot be reasonably determined. Because of the inherent uncertainty of valuation, those estimated values may be materially higher or lower than the values that would have been used had a ready market for the financial instruments existed. Accordingly, the degree of judgment exercised by the Fund in determining fair value is greatest for financial instruments categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy, within which the fair value measurement in its entirety falls, is determined based on the lowest level input that is significant to the fair value measurement.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Trust’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Trust uses prices and inputs that are current as of the measurement date, including periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many financial instruments. This condition could cause a financial instrument to be reclassified to a lower level within the fair value hierarchy. For instance, when Corn Futures Contracts on the Chicago Board of Trade (“CBOT”) are not actively trading due to a “limit-up” or ‘limit-down” condition, meaning that the change in the Corn Futures Contracts has exceeded the limits established, the Trust and the Fund will revert to alternative verifiable sources of valuation of its assets. When such a situation exists on a quarter close, the Sponsor will calculate the NAV on a particular day using the Level 1 valuation, but will later recalculate the NAV for the impacted Fund based upon the valuation inputs from these alternative verifiable sources (Level 2 or Level 3) and will report such NAV in its applicable financial statements and reports.

On September 30, 2016 and December 31, 2015, in the opinion of the Trust, the reported value at the close of the market for each commodity contract fairly reflected the value of the futures and no alternative valuations were required. The determination is made as of the settlement of the futures contracts on the last day of trading for the reporting period. In making the determination of a Level 1 or Level 2 transfer, the Funds consider the average volume of the specific underlying futures contracts traded on the relevant exchange for the periods being reported.

For the nine months ended September 30, 2016 and year ended December 31, 2015, the Funds did not have any significant transfers between any of the levels of the fair value hierarchy.

The Funds and the Trust record their derivative activities at fair value. Gains and losses from derivative contracts are included in the statements of operations. Derivative contracts include futures contracts related to commodity prices. Futures, which are listed on a national securities exchange, such as the CBOT and the ICE, or reported on another national market, are generally categorized in Level 1 of the fair value hierarchy. OTC derivatives contracts (such as forward and swap contracts), which may be valued using models, depending on whether significant inputs are observable or unobservable, are categorized in Levels 2 or 3 of the fair value hierarchy.

Investments in the securities of the Underlying Funds are freely traded and listed on the NYSE Arca. These investments are valued at the NAV of the Underlying Fund as of the valuation date as calculated by the administrator based on the exchange-quoted prices of the commodity futures contracts held by the Underlying Fund.

Expenses

Expenses are recorded using the accrual method of accounting.

New Accounting Pronouncements

The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments”. The amendments provide cash flow statement classification guidance. The amendments in this update are effective for fiscal years beginning after December 15, 2017. The Trust and the Funds are currently evaluating the impact on the financial statements and disclosures.

The FASB issued ASU 2016-11, “Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting”. The amendments make targeted improvements to clarify the principal versus agent assessment and are intended to make the guidance more operable and lead to more consistent application. The Sponsor has analyzed the ASU and its amendments and does not expect the adoption will have a material impact on the financial statements and disclosures of the Trust or the Funds.

The FASB issued ASU 2016-02, “Leases (Topic 842).” The amendment in this update increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The amendments in this update are effective for fiscal years beginning after December 15, 2018. This update will not have a material impact on the financial statements and disclosures of the Trust or the Funds.

The FASB issued ASU 2016-01, “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” The amendments in this update are intended to improve the recognitions measurement and disclosure of financial instruments. The amendments to this update are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. These amendments are required to be applied prospectively. The Trust and the Fund are currently evaluating the impact on the financial statements and disclosures.

The FASB issued ASU 2015-10, “Technical Corrections and Improvements.” The amendments in this update represent changes to clarify the Codification, correct unintended application of guidance, or make minor improvements to the Codification that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. The amendments are effective for fiscal years beginning after December 15, 2015. The adoption did not have a material impact on the financial statements and disclosures of the Trust or the Fund.

The FASB issued ASU 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent).” The ASU amends ASC 820 to create a practical expedient to measure the fair value of investments in certain entities that do not have a quoted market price but calculate net asset value per share or its equivalent. In addition, the amendments to ASC 820 provide guidance on classifying investments that are measured using the practical expedient in the fair value hierarchy and require specific disclosures for eligible investments, regardless of whether the practical expedient has been applied. The amendments in this Update are effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. These amendments are required to be applied retrospectively to all periods presented. The adoption did not have a material impact on the financial statements and disclosures of the Trust or the Fund.

The FASB issued ASU 2015-06, “Earnings per Share (Topic 260): Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions.” The amendments specify how earnings (losses) of a transferred business before the date of a dropdown transaction should be allocated to the various interest holders in a master limited partnership for purposes of calculating earning per unit under the two-class method. The amendments to this update are effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The amendments are required to be applied retrospectively for all periods presented. The adoption did not have a material impact on the financial statements and disclosures of the Trust or the Fund.

The FASB issued ASU 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis.” The amendments are intended to improve targeted areas of consolidation guidance for legal entities such as limited partnerships, limited liability corporations, and securitization structures. The amendments to this update are effective for periods beginning after December 15, 2015. These amendments are required to be applied retrospectively for all periods presented. The adoption did not have a material impact on the financial statements and disclosures of the Trust or the Fund.

The FASB issued ASU 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” The amendments in this update change the requirements for reporting discontinued operations in Subtopic 2015-20. A significant provision of ASU 2014-08 calls for reporting as discontinued operations only those disposals that represent a strategic shift or have a major impact on the entity’s financial results and operations. The Company elected to early adopt this ASU for the year ended December 31, 2014 and the adoption did not have a significant impact on the financial statements and disclosures of the Fund.

Note 4 – Fair Value Measurements

The Trust’s assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy as described in the Trust’s significant accounting policies in Note 3. The following table presents information about the Trust’s assets and liabilities measured at fair value as of September 30, 2016 and December 31, 2015:

September 30, 2016

							Balance as of
Assets:	Level 1		Level 2		Level 3		September 30, 2016
Cash equivalents	$	2,050,664	$	-	$	-	$	2,050,664
Commodity futures contracts
Soybean futures contracts		143,413		-		-		143,413
Sugar futures contracts		699,373		-		-		699,373
Total	$	2,893,450	$	-	$	-	$	2,893,450

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		September 30, 2016
Commodity futures contracts
Corn futures contracts	$	2,720,388	$	-	$	-	$	2,720,388
Soybean futures contracts		387,000						387,000
Sugar futures contracts		29,882		-		-		29,882
Wheat futures contracts		4,032,213		-		-		4,032,213
Total	$	7,169,483	$	-	$	-	$	7,169,483

December 31, 2015

							Balance as of
Assets:	Level 1		Level 2		Level 3		December 31, 2015
Cash equivalents	$	2,539,642	$	-	$	-	$	2,539,642
Commodity futures contracts
Soybean futures contracts		16,175		-		-		16,175
Sugar futures contracts		364,056		-		-		364,056
Total	$	2,919,873	$	-	$	-	$	2,919,873

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		December 31, 2015
Commodity futures contracts
Corn futures contracts	$	3,908,550	$	-	$	-	$	3,908,550
Soybean futures contracts		238,662		-		-		238,662
Wheat futures contracts		1,924,464		-		-		1,924,464
Total	$	6,071,676	$	-	$	-	$	6,071,676

For the nine months ended September 30, 2016 and year ended December 31, 2015, the Funds did not have any significant transfers between any of the levels of the fair value hierarchy.

See the Fair Value - Definition and Hierarchy section in Note 3 above for an explanation of the transfers into and out of each level of the fair value hierarchy.

Note 5 – Derivative Instruments and Hedging Activities

In the normal course of business, the Funds utilize derivative contracts in connection with its proprietary trading activities. Investments in derivative contracts are subject to additional risks that can result in a loss of all or part of an investment. The Funds’ derivative activities and exposure to derivative contracts are classified by the following primary underlying risks: interest rate, credit, commodity price, and equity price risks. In addition to its primary underlying risks, the Funds are also subject to additional counterparty risk due to inability of its counterparties to meet the terms of their contracts. For the nine months ended September 30, 2016 and year ended December 31, 2015, the Funds invested only in commodity futures contracts specifically related to each Fund.

Futures Contracts

The Funds are subject to commodity price risk in the normal course of pursuing their investment objectives. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date.

The purchase and sale of futures contracts requires margin deposits with a FCM. Subsequent payments (variation margin) are made or received by each Fund each day, depending on the daily fluctuations in the value of the contract, and are recorded as unrealized gains or losses by each

Fund. Futures contracts may reduce the Funds’ exposure to counterparty risk since futures contracts are exchange-traded; and the exchange’s clearinghouse, as the counterparty to all exchange-traded futures, guarantees the futures against default.

The Commodity Exchange Act requires an FCM to segregate all customer transactions and assets from the FCM’s proprietary activities. A customer’s cash and other equity deposited with an FCM are considered commingled with all other customer funds subject to the FCM’s segregation requirements. In the event of an FCM’s insolvency, recovery may be limited to each Fund’s pro rata share of segregated customer funds available. It is possible that the recovery amount could be less than the total of cash and other equity deposited.

The following table discloses information about offsetting assets and liabilities presented in the statements of assets and liabilities to enable users of these financial statements to evaluate the effect or potential effect of netting arrangements for recognized assets and liabilities. These recognized assets and liabilities are presented as defined in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities” and subsequently clarified in FASB ASU 2013-01 “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.”

The following table also identifies the fair value amounts of derivative instruments included in the statements of assets and liabilities as derivative contracts, categorized by primary underlying risk and held by the FCM, ED&F Man as of September 30, 2016 and December 31, 2015.

Offsetting of Financial Assets and Derivative Assets as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Assets

Liabilities

Available for Offset

to Broker

Net Amount

Commodity price

Soybean futures contracts

143,413

Sugar futures contracts

699,373

29,882

250,600

418,891

Offsetting of Financial Liabilities and Derivative Liabilities as of September 30, 2016

	(i)		(ii)		(iii) = (i) – (ii)		(iv)				(v) = (iii) – (iv)

							Gross Amount Not Offset in the
							Statement of Assets and Liabilities
			Gross Amount		Net Amount
			Offset in the		Presented in the
	Gross Amount		Statement of		Statement of
	of Recognized		Assets and		Assets and		Futures Contracts		Collateral, Due
Description	Liabilities		Liabilities		Liabilities		Available for Offset		from Broker		Net Amount
Commodity price
Corn futures contracts	$	2,720,388	$	-	$	2,720,388	$	-	$	2,720,388	$	-
Soybean futures contracts		387,000				387,000		143,413		243,587		-
Sugar futures contracts		29,882		-		29,882		29,882		-		-
Wheat futures contracts		4,032,213		-		4,032,213		-		4,032,213		-

Offsetting of Financial Assets and Derivative Assets as of December 31, 2015

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Assets

Liabilities

Available for Offset

to Broker

Net Amount

Commodity price

Soybean futures contracts

16,175

Sugar futures contracts

364,056

Offsetting of Financial Liabilities and Derivative Liabilities as of December 31, 2015

	(i)		(ii)		(iii) = (i) – (ii)		(iv)				(v) = (iii) – (iv)

							Gross Amount Not Offset in the
							Statement of Assets and Liabilities
			Gross Amount		Net Amount
			Offset in the		Presented in the
	Gross Amount		Statement of		Statement of
	of Recognized		Assets and		Assets and		Futures Contracts		Collateral, Due
Description	Liabilities		Liabilities		Liabilities		Available for Offset		from Broker		Net Amount
Commodity price
Corn futures contracts	$	3,908,550	$	-	$	3,908,550	$	-	$	3,908,550	$	-
Soybean futures contracts		238,662		-		238,662		16,175		222,487		-
Wheat futures contracts		1,924,464		-		1,924,464		-		1,924,464		-

The following is a summary of realized and unrealized gains (losses) of the derivative instruments utilized by the Trust:

Three months ended September 30, 2016

	Realized (Loss) Gain on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity price
Corn futures contracts	$	(6,486,500	)	$	937,100
Soybean futures contracts		28,163			(1,612,025	)
Sugar futures contracts		948,483			(18,088	)
Wheat futures contracts		(5,677,475	)		(692,500	)
Total commodity futures contracts	$	(11,187,329	)	$	(1,385,513	)

Three months ended September 30, 2015

	Realized Gain (Loss) on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity price
Corn futures contracts	$	83,175		$	(7,447,263	)
Soybean futures contracts		(356,775	)		(622,013	)
Sugar futures contracts		(446,791	)		116,167
Wheat futures contracts		(744,325	)		(5,046,488	)
Total commodity futures contracts	$	(1,464,716	)	$	(12,999,597	)

Nine months ended September 30, 2016

	Realized (Loss) Gain on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity price
Corn futures contracts	$	(8,878,588	)	$	1,188,163
Soybean futures contracts		990,062			(21,100	)
Sugar futures contracts		1,957,357			305,435
Wheat futures contracts		(7,244,175	)		(2,107,750	)
Total commodity futures contracts	$	(13,175,344	)	$	(635,252	)

Nine months ended September 30, 2015

	Realized Loss on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity price
Corn futures contracts	$	(4,245,750	)	$	(3,960,625	)
Soybean futures contracts		(1,091,489	)		(27,462	)
Sugar futures contracts		(1,286,051	)		312,379
Wheat futures contracts		(3,017,638	)		(1,794,075	)
Total commodity futures contracts	$	(9,640,928	)	$	(5,469,783	)

Volume of Derivative Activities

The average notional market value categorized by primary underlying risk for the futures contracts held for the three and nine months ended September 30, 2016, were $154.1 million and $119.1 million, respectively, and for the three and nine months ended September 30, 2015, were $112.8 million and $114.5 million.

Note 6 – Organizational and Offering Costs

Expenses incurred in organizing of the Trust and the initial offering of the shares, including applicable SEC registration fees, were borne directly by the Sponsor for the Funds and will be borne directly by the Sponsor for any series of the Trust which is not yet operating or will be issued in the future. The Trust will not be obligated to reimburse the Sponsor.

Note 7 – Detail of the net assets and shares outstanding of the Funds that are a series of the Trust

The following are the net assets and shares outstanding of each Fund that is a series of the Trust and, thus, in total, comprise the combined net assets of the Trust:

September 30, 2016

	Outstanding Shares		Net Assets
Teucrium Corn Fund		4,125,004	$	77,172,176
Teucrium Soybean Fund		725,004		13,436,212
Teucrium Sugar Fund		500,004		7,327,149
Teucrium Wheat Fund		7,600,004		54,638,344
Teucrium Agricultural Fund:
Net assets including the investment in the Underlying Funds		50,002		1,360,006
Less: Investment in the Underlying Funds				(1,354,764	)
Net for the Fund in the combined net assets of the Trust				5,242
Total			$	152,579,123

December 31, 2015


	Outstanding Shares		Net Assets
Teucrium Corn Fund		2,875,004	$	61,056,223
Teucrium Soybean Fund		375,004		6,502,552
Teucrium Sugar Fund		550,004		5,508,663
Teucrium Wheat Fund		2,900,004		26,529,260
Teucrium Agricultural Fund:
Net assets including the investment in the Underlying Funds		50,002		1,329,390
Less: Investment in the Underlying Funds				(1,324,601	)
Net for the Fund in the combined net assets of the Trust				4,789
Total			$	99,601,487

The detailed information for the subscriptions and redemptions, and other financial information for each Fund that is a series of the Trust are included in the accompanying financial statements of each Fund.

Note 8 – Subsequent Events

Management has evaluated the financial statements for the quarter-ended September 30, 2016 for subsequent events through the date of this filing and noted no material events requiring either recognition through the date of the filing or disclosure herein for the Trust and Funds other than those noted below:

CORN: Nothing to Report

SOYB:

On October 21, 2016, $13,000 of cash that had been held in custody at The Bank of New York Mellon was transferred to the Fund’s account at U.S. Bank. The balance for Restricted Cash is $90,616 as of this filing.

CANE: Nothing to Report

WEAT: Nothing to Report

TAGS: Nothing to Report

TEUCRIUM CORN FUND

STATEMENTS OF ASSETS AND LIABILITIES

	September 30, 2016		December 31, 2015
	(Unaudited)
Assets
Cash and cash equivalents	$	70,568,499	$	57,110,089
Interest receivable		9,304		379
Other assets		450,399		505,352
Equity in trading accounts:
Due from broker		8,930,875		7,405,938
Total assets		79,959,077		65,021,758

Liabilities
Management fee payable to Sponsor		66,513		53,729
Other liabilities		-		3,256
Equity in trading accounts:
Commodity futures contracts		2,720,388		3,908,550
Total liabilities		2,786,901		3,965,535

Net assets	$	77,172,176	$	61,056,223

Shares outstanding		4,125,004		2,875,004

Net asset value per share	$	18.71	$	21.24

Market value per share	$	18.68	$	21.22

The accompanying notes are an integral part of these financial statements.

TEUCRIUM CORN FUND

SCHEDULE OF INVESTMENTS

September 30, 2016
(Unaudited)

Percentage of

Description: Assets

Fair Value

Net Assets

Cash equivalents

Money market funds

Fidelity Institutional Money Market Funds - Government Portfolio (cost $449,013)

449,013

0.58

449,013

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States corn futures contracts
CBOT corn futures MAR17 (1,561 contracts)	$	1,109,538		1.44	%	$	27,044,325
CBOT corn futures MAY17 (1,311 contracts)		206,550		0.27			23,171,925
CBOT corn futures DEC17 (1,433 contracts)		1,404,300		1.82			26,976,225
Total commodity futures contracts	$	2,720,388		3.53	%	$	77,192,475

The accompanying notes are an integral part of these financial statements.

TEUCRIUM CORN FUND

SCHEDULE OF INVESTMENTS

December 31, 2015

Percentage of

Description: Assets

Fair Value

Net Assets

Cash equivalents

Money market funds

Fidelity Institutional Prime Money Market Portfolio (cost $899,313)

899,313

1.47

899,313

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States corn futures contracts
CBOT corn futures MAY16 (1,172 contracts)	$	1,910,013		3.13	%	$	21,359,700
CBOT corn futures JUL16 (988 contracts)		925,750		1.52			18,302,700
CBOT corn futures DEC16 (1,117 contracts)		1,072,787		1.76			21,390,550
Total commodity futures contracts	$	3,908,550		6.41	%	$	61,052,950

The accompanying notes are an integral part of these financial statements.

TEUCRIUM CORN FUND

STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Income
Realized and unrealized gain (loss) on trading of commodity futures contracts:
Realized (loss) gain on commodity futures contracts	$	(6,486,500	)	$	83,175		$	(8,878,588	)	$	(4,245,750	)
Net change in unrealized appreciation or depreciation on commodity futures contracts		937,100			(7,447,263	)		1,188,163			(3,960,625	)
Interest income		109,115			54,098			273,344			84,650
Total loss		(5,440,285	)		(7,309,990	)		(7,417,081	)		(8,121,725	)

Expenses
Management fees		201,142			197,131			510,014			614,666
Professional fees		228,200			151,750			642,025			589,250
Distribution and marketing fees		354,406			357,197			908,656			818,752
Custodian fees and expenses		38,950			49,149			120,410			113,215
Business permits and licenses fees		4,250			-			11,850			26,852
General and administrative expenses		22,128			58,430			79,133			150,230
Brokerage commissions		16,775			-			49,375			23,250
Other expenses		12,252			16,367			30,312			34,142
Total expenses		878,103			830,024			2,351,775			2,370,357

Expenses waived by the Sponsor		(134,161	)		(16,584	)		(134,161	)		(16,584	)

Total expenses, net		743,942			813,440			2,217,614			2,353,773

Net loss	$	(6,184,227	)	$	(8,123,430	)	$	(9,634,695	)	$	(10,475,498	)

Net loss per share	$	(1.63	)	$	(2.34	)	$	(2.53	)	$	(3.08	)
Net loss per weighted average share	$	(1.46	)	$	(2.48	)	$	(2.88	)	$	(3.12	)
Weighted average shares outstanding		4,244,297			3,275,004			3,342,431			3,353,759

The accompanying notes are an integral part of these financial statements.

TEUCRIUM CORN FUND

STATEMENTS OF CHANGES IN NET ASSETS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Operations
Net loss	$	(9,634,695	)	$	(10,475,498	)
Capital transactions
Issuance of Shares		45,239,528			8,538,197
Redemption of Shares		(19,488,880	)		(36,494,855	)
Total capital transactions		25,750,648			(27,956,658	)
Net change in net assets		16,115,953			(38,432,156	)

Net assets, beginning of period	$	61,056,223		$	108,459,507

Net assets, end of period	$	77,172,176		$	70,027,351

Net asset value per share at beginning of period	$	21.24		$	26.62

Net asset value per share at end of period	$	18.71		$	23.54

Creation of Shares		2,225,000			350,000
Redemption of Shares		975,000			1,450,000

The accompanying notes are an integral part of these financial statements.

TEUCRIUM CORN FUND

STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Cash flows from operating activities:
Net loss	$	(9,634,695	)	$	(10,475,498	)
Adjustments to reconcile net loss to net cash used in operating activities:
Net change in unrealized appreciation or depreciation on commodity futures contracts		(1,188,163	)		3,960,625
Changes in operating assets and liabilities:
Due from broker		(1,524,937	)		(5,298,726	)
Interest receivable		(8,925	)		6,677
Restricted cash		-			(16,504	)
Other assets		54,953			(303,331	)
Management fee payable to Sponsor		12,784			(39,520	)
Other liabilities		(3,255	)		(111,022	)
Net cash used in operating activities		(12,292,238	)		(12,277,299	)

Cash flows from financing activities:
Proceeds from sale of Shares		45,239,528			8,538,197
Redemption of Shares		(19,488,880	)		(38,491,040	)
Net cash provided by (used in) financing activities		25,750,648			(29,952,843	)

Net change in cash and cash equivalents		13,458,410			(42,230,142	)
Cash and cash equivalents, beginning of period		57,110,089			106,858,496
Cash and cash equivalents, end of period	$	70,568,499		$	64,628,354

The accompanying notes are an integral part of these financial statements.

NOTES TO FINANCIAL STATEMENTS

September 30, 2016

(Unaudited)

Note 1 – Organization and Operation

Teucrium Corn Fund (referred to herein as “CORN,” or the “Fund”) is a commodity pool that is a series of Teucrium Commodity Trust (“Trust”), a Delaware statutory trust formed on September 11, 2009. The Fund issues common units, called the “Shares,” representing fractional undivided beneficial interests in the Fund. The Fund continuously offers Creation Baskets consisting of 25,000 Shares at their Net Asset Value (“NAV”) to “Authorized Purchasers” through Foreside Fund Services, LLC, which is the distributor for the Fund (the “Distributor”). Authorized Purchasers sell such Shares, which are listed on the New York Stock Exchange (“NYSE”) Arca under the symbol “CORN,” to the public at per-Share offering prices that reflect, among other factors, the trading price of the Shares on the NYSE Arca, the NAV of the Fund at the time the Authorized Purchaser purchased the Creation Baskets and the NAV at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the markets for corn interests. The Fund’s Shares trade in the secondary market on the NYSE Arca at prices that are lower or higher than their NAV per Share.

The investment objective of CORN is to have the daily changes in percentage terms of the Shares’ NAV reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for three futures contracts for corn (“Corn Futures Contracts”) that are traded on the Chicago Board of Trade (“CBOT”), specifically (1) the second-to-expire CBOT Corn Futures Contract, weighted 35%, (2) the third-to-expire CBOT Corn Futures Contract, weighted 30%, and (3) the CBOT Corn Futures Contract expiring in the December following the expiration month of the third-to-expire contract, weighted 35%.

The Fund commenced investment operations on June 9, 2010 and has a fiscal year ending on December 31. The Fund’s sponsor is Teucrium Trading, LLC (the “Sponsor”). The Sponsor is responsible for the management of the Fund. The Sponsor is a member of the National Futures Association (the “NFA”) and became a commodity pool operator registered with the Commodity Futures Trading Commission (the “CFTC”) effective November 10, 2009.

On June 5, 2010, the Fund’s initial registration of 30,000,000 shares the Form S-1 was declared effective by the U.S. Securities and Exchange Commission (“SEC”). On June 9, 2010, the Fund listed its shares on the NYSE Arca under the ticker symbol “CORN.” On the day prior to that, the Fund issued 200,000 shares in exchange for $5,000,000 at the Fund’s initial NAV of $25 per share. The Fund also commenced investment operations on June 9, 2010 by purchasing commodity futures contracts traded on the Chicago Board of Trade (“CBOT”). On April 29, 2016, a subsequent registration statement for CORN was declared effective by the SEC.

The accompanying unaudited financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X promulgated by the SEC and, therefore, do not include all information and footnote disclosures required under accounting principles generally accepted in the United States of America (“GAAP”). The financial information included herein is unaudited; however, such financial information reflects all adjustments which are, in the opinion of management, necessary for the fair presentation of the Fund’s financial statements for the interim period. It is suggested that these interim financial statements be read in conjunction with the financial statements and related notes included in the Trust’s Annual Report on Form 10-K, as well as the most recent Form S-1 filing, as applicable. The operating results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016.

Subject to the terms of the Trust Agreement, Teucrium Trading, LLC, in its capacity as the Sponsor (“Sponsor”), may terminate a Fund at any time, regardless of whether the Fund has incurred losses, including, for instance, if it determines that the Fund’s aggregate net assets in relation to its operating expenses make the continued operation of the Fund unreasonable or imprudent. However, no level of losses will require the Sponsor to terminate a Fund.

Note 2 – Principal Contracts and Agreements

Given this conversion, beginning with the quarter ended June 30, 2015 and for the year-ended December 31, 2015, the statements of operations reflected an expense, before and after fees waived by the Sponsor, for fees associated with Custodian, Fund Administration and Transfer Agent services (“Custodian Fees”) that have or will be paid to the Bank of New York Mellon by a Fund or by the Sponsor on behalf of a Fund. The Custodian Fees reflected in the financial statements through December 31, 2015, net of expenses waived by the Sponsor, are generally as had been presented in prior periods of 2015.

For custody services, the Funds will pay to U.S. Bank N.A. 0.0075% of average gross assets up to $1 billion, and .0050% of average gross assets over $1 billion, annually, plus certain per-transaction charges. For Transfer Agency, Fund Accounting and Fund Administration services, which are based on the total assets for all the Funds in the Trust, the Funds will pay to USBFS 0.06% of average gross assets on the first $250 million, 0.05% on the next $250 million, 0.04% on the next $500 million and 0.03% on the balance over $1 billion annually. A combined minimum annual fee of up to $64,500 for custody, transfer agency, accounting and administrative services is assessed per Fund. For the three months ended September 30, 2016 and 2015, the Fund recognized $38,950 and $49,149, respectively, for these services, which is recorded in custodian fees and expenses on the statements of operations; of these expenses $0 in 2016 and $16,584 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Fund recognized $120,410 and $113,215, respectively, for these services, which was recorded in custodian fees and expenses on the statements of operations; of these expenses $0 in 2016 and $16,584 in 2015 were waived by the Sponsor.

The Sponsor employs Foreside Fund Services, LLC (“Foreside” or the “Distributor”) as the Distributor for the Funds. The Distribution Services Agreement among the Distributor and the Sponsor calls for the Distributor to work with the Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials. The Distributor and the Sponsor have also entered into a Securities Activities and Service Agreement (the “SASA”) under which certain employees and officers of the Sponsor are licensed as registered representatives or registered principals of the Distributor, under Financial Industry Regulatory Authority (“FINRA”) rules. For its services as the Distributor, Foreside receives a fee of 0.01% of the Fund’s average daily net assets and an aggregate annual fee of $100,000 for all Teucrium Funds, along with certain expense reimbursements. For its services under the SASA, Foreside receives a fee of $5,000 per registered representative and $1,000 per registered location. For the three months ended September 30, 2016 and 2015, the Fund recognized $19,244 and $21,858, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations and was paid for by the Fund. For the nine months ended September 30, 2016 and 2015, the Fund recognized $57,119 and $76,994, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations and was paid for by the Fund.

Currently, ED&F Man serves as the Underlying Funds’ clearing broker to execute and clear the Underlying Funds’ futures and provide other brokerage-related services. ED&F Man is registered as a FCM with the U.S. CFTC and is a member of the NFA. ED&F Man is also registered as a broker/dealer with the U.S. Securities and Exchange Commission and is a member of the FINRA. ED&F Man is a clearing member of ICE Futures U.S., Inc., Chicago Board of Trade, Chicago Mercantile Exchange, New York Mercantile Exchange, and all other major United States commodity exchanges. For Corn, Soybean, Sugar and Wheat Futures Contracts ED&F Man, Jefferies and SG were paid $8.00 per round turn. Effective January 1, 2016, ED&F Man, increased the per round-term charge for futures contracts commission to $9.00. For the three months ended September 30, 2016 and 2015, the Fund recognized $16,775 and $0, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and was paid for by the Fund. For the nine months ended September 30, 2016 and 2015, the Fund recognized $49,375 and $23,250, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and was paid for by the Fund.

The sole Trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation. The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory Trust Act. For its services, the Trustee receives an annual fee of $3,300 from the Trust. For the three and nine months ended September 30, 2016, the Fund recognized $1,550 for these services, which is recorded in business permits and licenses on the statement of operations and was waived by the Sponsor. For the three and nine months ended September 30, 2015, the Fund did not recognize any expense for these services.

Note 3 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as detailed in the Financial Accounting Standards Board’s Accounting Standards Codification.

Revenue Recognition

Commodity futures contracts are recorded on the trade date. All such transactions are recorded on the identified cost basis and marked to market daily. Unrealized appreciation or depreciation on commodity futures contracts are reflected in the statements of assets and liabilities as the difference between the original contract amount and the fair market value as of the last business day of the year or as of the last date of the financial statements. Changes in the appreciation or depreciation between periods are reflected in the statements of operations. Interest on cash equivalents and deposits with the Futures Commission Merchant are recognized on the accrual basis. The Fund earns interest on its assets denominated in U.S. dollars on deposit with the Futures Commission Merchant. In addition, the Fund earns interest on funds held at the custodian at prevailing market rates for such investments.

Brokerage Commissions

Brokerage commissions on all open commodity futures contracts are accrued on the trade date and on a full-turn basis.

Income Taxes

For tax purposes, the Fund will be treated as a partnership. The Fund does not record a provision for income taxes because the shareholders report their share of the Fund’s income or loss on their income tax returns. The financial statements reflect the Fund’s transactions without adjustment, if any, required for income tax purposes.

The Fund is required to determine whether a tax position is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Fund files an income tax return in the U.S. federal jurisdiction, and may file income tax returns in various U.S. states and foreign jurisdictions. For all tax years 2013 to 2015, the Fund remains subject to income tax examinations by major taxing authorities. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. De-recognition of a tax benefit previously recognized results in the Fund recording a tax liability that reduces net assets. Based on its analysis, the Fund has determined that it has not incurred any liability for unrecognized tax benefits as of September 30, 2016 and for the years ended December 31, 2015, 2014 and 2013. However, the Fund’s conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, ongoing analysis of and changes to tax laws, regulations, and interpretations thereof.

The Fund recognizes interest accrued related to unrecognized tax benefits and penalties related to unrecognized tax benefits in income tax fees payable, if assessed. No interest expense or penalties have been recognized as of and for the nine months ended September 30, 2016 and 2015.

The Fund may be subject to potential examination by U.S. federal, U.S. state, or foreign jurisdictional authorities in the area of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions, and compliance with U.S. federal, U.S. state and foreign tax laws. The Fund’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

Creations and Redemptions

Authorized Purchasers may purchase Creation Baskets consisting of 25,000 shares from CORN. The amount of the proceeds required to purchase a Creation Basket will be equal to the NAV of the shares in the Creation Basket determined as of 4:00 p.m. New York time on the day the order to create the basket is properly received.

Authorized Purchasers may redeem shares from the Fund only in blocks of 25,000 shares called “Redemption Baskets.” The amount of the redemption proceeds for a Redemption Basket will be equal to the NAV of the shares in the Redemption Basket determined as of 4:00 p.m. New York time on the day the order to redeem the basket is properly received.

The Fund receives or pays the proceeds from shares sold or redeemed within three business days after the trade date of the purchase or redemption. The amounts due from Authorized Purchasers are reflected in the Fund’s statements of assets and liabilities as receivable for shares sold. Amounts payable to Authorized Purchasers upon redemption are reflected in the Fund’s statements of assets and liabilities as payable for shares redeemed.

As outlined in the most recent Form S-3 filing, 50,000 shares represents two Redemption Baskets for the Fund and a minimum level of shares.

Allocation of Shareholder Income and Losses

Profit or loss is allocated among the shareholders of the Fund in proportion to the number of shares each shareholder holds as of the close of each month.

Cash Equivalents

Cash equivalents are highly-liquid investments with maturity dates of 90 days or less when acquired. The Fund reported its cash equivalents in the statements of assets and liabilities at market value, or at carrying amounts that approximate fair value, because of their highly-liquid nature and short-term maturities. The Fund has these balances of its assets on deposit with banks. The Fund had a balance of $449,013 and $899,313 in money market funds at September 30, 2016 and December 31, 2015, respectively; these balances are included in cash and cash equivalents on the statements of assets and liabilities. Effective in the second quarter 2015, the Sponsor invested a portion of the available cash for the Fund in alternative demand-deposit savings accounts, which is classified as cash and not as a cash equivalent. The Fund had a balance of $70,119,486 as of September 30, 2016 and $56,210,776 as of December 31, 2015, in demand-deposit savings accounts. This change resulted in a reduction in the balance held in money market funds. Assets deposited with the bank may, at times, exceed federally insured limits.

Due from/to Broker

The amount recorded by the Fund for the amount due from and to the clearing broker includes, but is not limited to, cash held by the broker, amounts payable to the clearing broker related to open transactions and payables for commodities futures accounts liquidating to an equity balance on the clearing broker’s records.

Margin is the minimum amount of funds that must be deposited by a commodity interest trader with the trader’s broker to initiate and maintain an open position in futures contracts. A margin deposit acts to assure the trader’s performance of the futures contracts purchased or sold. Futures contracts are customarily bought and sold on initial margin that represents a very small percentage of the aggregate purchase or sales price of the contract. Because of such low margin requirements, price fluctuations occurring in the futures markets may create profits and losses that, in relation to the amount invested, are greater than are customary in other forms of investment or speculation. As discussed below, adverse price changes in the futures contract may result in margin requirements that greatly exceed the initial margin. In addition, the amount of margin required in connection with a particular futures contract is set from time to time by the exchange on which the contract is traded and may be modified from time to time by the exchange during the term of the contract. Brokerage firms, such as the Fund’s clearing brokers, carrying accounts for traders in commodity interest contracts generally require higher amounts of margin as a matter of policy to further protect themselves. Over-the-counter trading generally involves the extension of credit between counterparties, so the counterparties may agree to require the posting of collateral by one or both parties to address credit exposure.

Ongoing or “maintenance” margin requirements are computed each day by a trader’s clearing broker. When the market value of a particular open futures contract changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the broker. If the margin call is not met within a reasonable time, the broker may close out the trader’s position. With respect to the Fund’s trading, the Fund (and not its shareholders personally) is subject to margin calls.

Finally, many major U.S. exchanges have passed certain cross margining arrangements involving procedures pursuant to which the futures and options positions held in an account would, in the case of some accounts, be aggregated and margin requirements would be assessed on a portfolio basis, measuring the total risk of the combined positions.

Calculation of Net Asset Value

The Fund’s NAV is calculated by:

•

Taking the current market value of its total assets and

•

Subtracting any liabilities.

The administrator, USBFS, calculates the NAV of the Fund once each trading day. It calculates the NAV as of the earlier of the close of the NYSE or 4:00 p.m. New York time. The NAV for a particular trading day is released after 4:15 p.m. New York time.

In determining the value of Corn Futures Contracts, the administrator uses the CBOT closing price. The administrator determines the value of all other Fund investments as of the earlier of the close of the NYSE or 4:00 p.m. New York time. The value of over-the-counter corn interests is determined based on the value of the commodity or futures contract underlying such corn interest, except that a fair value may be determined if the Sponsor believes that the Fund is subject to significant credit risk relating to the counterparty to such corn interest. For purposes of financial statements and reports, the Sponsor will recalculate the NAV where necessary to reflect the “fair value” of a Futures Contract when the Futures Contract closes at its price fluctuation limit for the day. Treasury securities held by the Fund are valued by the administrator using values received from recognized third-party vendors and dealer quotes. NAV includes any unrealized profit or loss on open corn interests and any other income or expense accruing to the Fund but unpaid or not received by the Fund.

Sponsor Fee, Allocation of Expenses and Related Party Transactions

The Sponsor is responsible for investing the assets of the Fund in accordance with the objectives and policies of the Fund. In addition, the Sponsor arranges for one or more third parties to provide administrative, custodial, accounting, transfer agency and other necessary services to the Trust and the Funds. In addition, the Sponsor elected not to outsource services directly attributable to the Trust and the Funds such as accounting, financial reporting, regulatory compliance and trading activities. In addition, the Fund is contractually obligated to pay a monthly management fee to the Sponsor, based on average daily net assets, at a rate equal to 1.00% per annum.

The Fund generally pays for all brokerage fees, taxes and other expenses, including licensing fees for the use of intellectual property, registration or other fees paid to the SEC, FINRA, formerly the National Association of Securities Dealers, or any other regulatory agency in connection with the offer and sale of subsequent Shares after its initial registration and all legal, accounting, printing and other expenses associated therewith. The Fund also pays its portion of the fees and expenses associated with the Trust’s tax accounting and reporting requirements. Certain aggregate expenses common to all Funds within the Trust are allocated by the Sponsor to the respective funds based on

activity drivers deemed most appropriate by the Sponsor for such expenses, including but not limited to relative assets under management and creation and redeem order activity.

These aggregate common expenses include, but are not limited to, legal, auditing, accounting and financial reporting, tax-preparation, regulatory compliance, trading activities, and insurance costs, as well as fees paid to the Distributor, which are included in the related line item in the statements of operations. A portion of these aggregate common expenses are related to the Sponsor or related parties of principals of the Sponsor; these are necessary services to the Funds, which are primarily the cost of performing accounting and financial reporting, regulatory compliance, and trading activities that are directly attributable to the Fund. For the three months ended September 30, such expenses, which are primarily recorded in distribution and marketing fees on the statements of operations, totaled $216,161 in 2016 and $231,044 in 2015; of these amounts, $105,139 in 2016 and $0 in 2015 were waived by the Sponsor. For the nine months ended September 30, such expenses, totaled $726,627 in 2016 and $837,015 in 2015; of these amounts, $105,139 in 2016 and $0 in 2015 were waived by the Sponsor. All asset-based fees and expenses for the Funds are calculated on the prior day’s net assets.

For the three and nine months ended September 30, 2016, there were $134,161 of expenses that were on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the three and nine months ended September 30, 2015, there were $16,584 of expenses that were on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

Use of Estimates

Fair Value - Definition and Hierarchy

In determining fair value, the Fund uses various valuation approaches. In accordance with GAAP, a fair value hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows:

Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 financial instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these financial instruments does not entail a significant degree of judgment.

Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Corn Futures Contracts has exceeded the limits established, the Trust and the Fund will revert to alternative verifiable sources of valuation of its assets. When such a situation exists on a quarter close, the Sponsor will calculate the Net Asset Value (“NAV”) on a particular day using the Level 1 valuation, but will later recalculate the NAV for the impacted Fund based upon the valuation inputs from these alternative verifiable sources (Level 2 or Level 3) and will report such NAV in its applicable financial statements and reports.

On September 30, 2016 and December 31, 2015, in the opinion of the Trust and the Fund, the reported value of the Corn Futures Contracts traded on the CBOT fairly reflected the value of the Corn Futures Contracts held by the Fund, and no adjustments were necessary. The determination is made as of the settlement of the futures contracts on the last day of trading for the reporting period. In making the determination of a Level 1 or Level 2 transfer, the Fund considers the average volume of the specific underlying futures contracts traded on the relevant exchange for the periods being reported.

For the nine months ended September 30, 2016 and for the year ended December 31, 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

The Fund records its derivative activities at fair value. Gains and losses from derivative contracts are included in the statements of operations. Derivative contracts include futures contracts related to commodity prices. Futures, which are listed on a national securities exchange, such as the CBOT and the ICE, or reported on another national market, are generally categorized in Level 1 of the fair value hierarchy. OTC derivatives contracts (such as forward and swap contracts) which may be valued using models, depending on whether significant inputs are observable or unobservable, are categorized in Levels 2 or 3 of the fair value hierarchy.

Expenses

Expenses are recorded using the accrual method of accounting.

Net Income (Loss) per Share

Net income (loss) per share is the difference between the NAV per unit at the beginning of each period and at the end of each period. The weighted average number of units outstanding was computed for purposes of disclosing net income (loss) per weighted average unit. The weighted average units are equal to the number of units outstanding at the end of the period, adjusted proportionately for units created or redeemed based on the amount of time the units were outstanding during such period.

New Accounting Pronouncements

specific disclosures for eligible investments, regardless of whether the practical expedient has been applied. The amendments in this Update are effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. These amendments are required to be applied retrospectively to all periods presented. The adoption did not have a material impact on the financial statements and disclosures of the Trust or the Fund.

Note 4 – Fair Value Measurements

The Fund’s assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy as described in the Fund’s significant accounting policies in Note 2. The following table presents information about the Fund’s assets and liabilities measured at fair value as of September 30, 2016 and December 31, 2015:

September 30, 2016

							Balance as of
Assets:	Level 1		Level 2		Level 3		September 30, 2016
Cash equivalents	$	449,013	$	-	$	-	$	449,013

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		September 30, 2016
Corn futures contracts	$	2,720,388	$	-	$	-	$	2,720,388

December 31, 2015

							Balance as of
Assets:	Level 1		Level 2		Level 3		December 31, 2015
Cash equivalents	$	899,313	$	-	$	-	$	899,313

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		December 31, 2015
Corn futures contracts	$	3,908,550	$	-	$	-	$	3,908,550

For the nine months ended September 30, 2016 and year ended December 31 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

See the Fair Value - Definition and Hierarchy section in Note 3 above for an explanation of the transfers into and out of each level of the fair value hierarchy.

Note 5 – Derivative Instruments and Hedging Activities

In the normal course of business, the Fund utilizes derivative contracts in connection with its proprietary trading activities. Investments in derivative contracts are subject to additional risks that can result in a loss of all or part of an investment. The Fund’s derivative activities and exposure to derivative contracts are classified by the following primary underlying risks: interest rate, credit, commodity price, and equity price risks. In addition to its primary underlying risks, the Fund is also subject to additional counterparty risk due to inability of its counterparties to meet the terms of their contracts. For nine months ended September 30, 2016 and year ended December 31, 2015, the Fund invested only in commodity futures contracts.

Futures Contracts

The Fund is subject to commodity price risk in the normal course of pursuing its investment objectives. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date.

The purchase and sale of futures contracts requires margin deposits with a FCM. Subsequent payments (variation margin) are made or received by the Fund each day, depending on the daily fluctuations in the value of the contract, and are recorded as unrealized gains or losses by the Fund. Futures contracts may reduce the Fund’s exposure to counterparty risk since futures contracts are exchange-traded; and the exchange’s clearinghouse, as the counterparty to all exchange-traded futures, guarantees the futures against default.

The Commodity Exchange Act requires an FCM to segregate all customer transactions and assets from the FCM’s proprietary activities. A customer’s cash and other equity deposited with an FCM are considered commingled with all other customer funds subject to the FCM’s segregation requirements. In the event of an FCM’s insolvency, recovery may be limited to the Fund’s pro rata share of segregated customer funds available. It is possible that the recovery amount could be less than the total of cash and other equity deposited.

The following table discloses information about offsetting assets and liabilities presented in the statements of assets and liabilities to enable users of these financial statements to evaluate the effect or potential effect of netting arrangements for recognized assets and liabilities. These recognized assets and liabilities are presented as defined in FASB ASU No. 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities” and subsequently clarified in FASB ASU 2013-01 “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.”

Offsetting of Financial Liabilities and Derivative Liabilities as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Liabilities

Available for Offset

from Broker

Net Amount

Commodity price

Corn futures contracts

2,720,388

Offsetting of Financial Liabilities and Derivative Liabilities as of December 31, 2015

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Liabilities

Available for Offset

from Broker

Net Amount

Commodity price

Corn futures contracts

3,908,550

The following tables identify the net gain and loss amounts included in the statements of operations as realized and unrealized gains and losses on trading of commodity futures contracts categorized by primary underlying risk:

Three months ended September 30, 2016

	Realized Loss on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity Price
Corn futures contracts	$	(6,486,500	)	$	937,100

Three months ended September 30, 2015

	Realized Gain on		Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts		Depreciation on Commodity Futures Contracts
Commodity Price
Corn futures contracts	$	83,175	$	(7,447,263	)

Nine months ended September 30, 2016

	Realized Loss on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity Price
Corn futures contracts	$	(8,878,588	)	$	1,188,163

Nine months ended September 30, 2015

	Realized Loss on			Net Change in Unrealized Appreciation or
Primary Underlying Risk	Commodity Futures Contracts			Depreciation on Commodity Futures Contracts
Commodity Price
Corn futures contracts	$	(4,245,750	)	$	(3,960,625	)

Volume of Derivative Activities

The average notional market value categorized by primary underlying risk for the futures contracts held were $81.5 million and $67.0 million for the three and nine months ended September 30, 2016 and $73.8 million and $78.1 million for the same periods in 2015.

Note 6 – Financial Highlights

The following tables present per unit performance data and other supplemental financial data for the three and nine months ended September 30, 2016 and 2015. This information has been derived from information presented in the financial statements and is presented with total expenses gross of expenses waived by the Sponsor and with total expenses net of expenses waived by the Sponsor, as appropriate.

	Three months ended			Three months ended			Nine months ended			Nine months ended
Per Share Operation Performance	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Net asset value at beginning of period	$	20.34		$	25.88		$	21.24		$	26.62
Income (loss) from investment operations:
Income		0.03			0.02			0.08			0.02
Net realized and unrealized loss on commodity futures contracts		(1.48	)		(2.11	)		(1.95	)		(2.40	)
Total expenses		(0.18	)		(0.25	)		(0.66	)		(0.70	)
Net decrease in net asset value		(1.63	)		(2.34	)		(2.53	)		(3.08	)
Net asset value at end of period	$	18.71		$	23.54		$	18.71		$	23.54
Total Return		(8.01	)%		(9.04	)%		(11.91	)%		(11.57	)%
Ratios to Average Net Assets (Annualized)
Total expenses		4.37	%		4.21	%		4.61	%		3.86	%
Total expense, net		3.70	%		4.13	%		4.35	%		3.83	%
Net investment loss		(3.16	)%		(3.86	)%		(3.81	)%		(3.70	)%

Effective in the third quarter 2015, the financial highlights per share data are calculated consistent with the methodology used to calculate asset-based fees and expenses. In prior periods, the financial highlights per share data are calculated using the average of the daily shares outstanding for the reporting period, which is inclusive of the last day of the period. Any change in methodology was not material to the ratios presented.

Note 7 – Organizational and Offering Costs

Expenses incurred in organizing of the Trust and the initial offering of the Shares of the Fund, including applicable SEC registration fees were borne directly by the Sponsor. The Fund will not be obligated to reimburse the Sponsor.

Note 8 – Subsequent Events

TEUCRIUM SOYBEAN FUND

STATEMENTS OF ASSETS AND LIABILITIES

	September 30, 2016		December 31, 2015
	(Unaudited)
Assets
Cash and cash equivalents	$	12,497,893	$	5,937,824
Interest receivable		1,466		51
Restricted cash		103,616		142,616
Other assets		54,558		49,618
Equity in trading accounts:
Commodity futures contracts		143,413		16,175
Due from broker		1,033,933		604,666
Total equity in trading accounts		1,177,346		620,841
Total assets		13,834,879		6,750,950

Liabilities
Management fee payable to Sponsor		10,874		5,908
Other liabilities		793		3,828
Equity in trading accounts:
Commodity futures contracts		387,000		238,662
Total liabilities		398,667		248,398

Net assets	$	13,436,212	$	6,502,552

Shares outstanding		725,004		375,004

Net asset value per share	$	18.53	$	17.34

Market value per share	$	18.48	$	17.33

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SOYBEAN FUND

SCHEDULE OF INVESTMENTS

September 30, 2016

(Unaudited)

Percentage of

Description: Assets

Fair Value

Net Assets

Cash equivalents

Money market funds

Fidelity Institutional Money Market Funds - Government Portfolio (cost $230,144)

230,144

1.71

230,144

					Notional Amount
					(Long Exposure)
Commodity futures contracts
United States soybean futures contracts
CBOT soybean futures NOV17 (99 contracts)	$	143,413	1.07	%	$	4,718,588

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States soybean futures contracts
CBOT soybean futures JAN17 (98 contracts)	$	355,200		2.64	%	$	4,700,325
CBOT soybean futures MAR17 (83 contracts)		31,800		0.24			4,006,825
Total commodity futures contracts	$	387,000		2.88	%	$	8,707,150

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SOYBEAN FUND

SCHEDULE OF INVESTMENTS

December 31, 2015

Percentage of

Description: Assets

Fair Value

Net Assets

Cash equivalents

Money market funds

Fidelity Institutional Prime Money Market Portfolio (cost $161,718)

161,718

2.49

161,718

					Notional Amount
Commodity futures contracts					(Long Exposure)
United States soybean futures contracts
CBOT soybean futures MAY16 (45 contracts)	$	16,175	0.25	%	$	1,956,375

			Percentage of			Notional Amount
Description: Liabilities	Fair Value		Net Assets			(Long Exposure)

Commodity futures contracts
United States soybean futures contracts
CBOT soybean futures MAR16 (52 contracts)	$	30,075		0.46	%	$	2,247,050
CBOT soybean futures NOV16 (52 contracts)		208,587		3.21			2,295,150
Total commodity futures contracts	$	238,662		3.67	%	$	4,542,200

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SOYBEAN FUND

STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Income
Realized and unrealized gain (loss) on trading of commodity futures contracts:
Realized gain (loss) on commodity futures contracts	$	28,163		$	(356,775	)	$	990,062		$	(1,091,489	)
Net change in unrealized appreciation or depreciation on commodity futures contracts		(1,612,025	)		(622,013	)		(21,100	)		(27,462	)
Interest income		16,996			4,769			44,291			6,609
Total (loss) income		(1,566,866	)		(974,019	)		1,013,253			(1,112,342	)

Expenses
Management fees		31,398			18,701			83,216			55,603
Professional fees		77,033			67,993			96,954			100,679
Distribution and marketing fees		59,675			30,596			154,687			78,138
Custodian fees and expenses		7,291			69,982			19,231			133,982
Business permits and licenses fees		4,451			3,468			13,598			13,542
General and administrative expenses		7,453			7,083			21,856			16,061
Brokerage commissions		-			1,683			1,507			4,445
Other expenses		2,346			20			7,792			2,515
Total expenses		189,647			199,526			398,841			404,965

Expenses waived by the Sponsor		(63,113	)		(129,551	)		(63,113	)		(243,723	)

Total expenses, net		126,534			69,975			335,728			161,242

Net (loss) income	$	(1,693,400	)	$	(1,043,994	)	$	677,525		$	(1,273,584	)

Net (loss) income per share	$	(2.84	)	$	(2.62	)	$	1.19		$	(2.81	)
Net (loss) income per weighted average share	$	(2.58	)	$	(2.63	)	$	1.15		$	(3.33	)
Weighted average shares outstanding		656,526			397,287			588,234			382,422

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SOYBEAN FUND

STATEMENTS OF CHANGES IN NET ASSETS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Operations
Net income (loss)	$	677,525		$	(1,273,584	)
Capital transactions
Issuance of Shares		8,210,615			2,478,439
Redemption of Shares		(1,954,480	)		(5,967,495	)
Total capital transactions		6,256,135			(3,489,056	)
Net change in net assets		6,933,660			(4,762,640	)

Net assets, beginning of period	$	6,502,552		$	11,956,149

Net assets, end of period	$	13,436,212		$	7,193,509

Net asset value per share at beginning of period	$	17.34		$	20.79

Net asset value per share at end of period	$	18.53		$	17.98

Creation of Shares		450,000			125,000
Redemption of Shares		100,000			300,000

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SOYBEAN FUND

STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Cash flows from operating activities:
Net income (loss)	$	677,525		$	(1,273,584	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net change in unrealized appreciation or depreciation on commodity futures contracts		21,100			27,462
Changes in operating assets and liabilities:
Due from broker		(429,267	)		(113,736	)
Interest receivable		(1,415	)		715
Restricted cash		39,000			(142,616	)
Other assets		(4,940	)		(19,273	)
Management fee payable to Sponsor		4,966			(4,636	)
Other liabilities		(3,035	)		(2,033	)
Net cash provided by (used in) operating activities		303,934			(1,527,701	)

Cash flows from financing activities:
Proceeds from sale of Shares		8,210,615			2,478,439
Redemption of Shares		(1,954,480	)		(5,967,495	)
Net cash provided by (used in) financing activities		6,256,135			(3,489,056	)

Net change in cash and cash equivalents		6,560,069			(5,016,757	)
Cash and cash equivalents, beginning of period		5,937,824			11,505,788
Cash and cash equivalents, end of period	$	12,497,893		$	6,489,031

The accompanying notes are an integral part of these financial statements.

NOTES TO FINANCIAL STATEMENTS

September 30, 2016

(Unaudited)

Note 1 – Organization and Operation

Teucrium Soybean Fund (referred to herein as “SOYB” or the “Fund”) is a commodity pool that is a series of Teucrium Commodity Trust (“Trust”), a Delaware statutory trust formed on September 11, 2009. The Fund issues common units, called the “Shares,” representing fractional undivided beneficial interests in the Fund. The Fund continuously offers Creation Baskets consisting of 25,000 Shares at their Net Asset Value (“NAV”) to “Authorized Purchasers” through Foreside Fund Services, LLC, which is the distributor for the Fund (the “Distributor”). Authorized Purchasers sell such Shares, which are listed on the New York Stock Exchange (“NYSE”) Arca under the symbol “SOYB,” to the public at per-Share offering prices that reflect, among other factors, the trading price of the Shares on the NYSE Arca, the NAV of the Fund at the time the Authorized Purchaser purchased the Creation Baskets and the NAV at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the markets for soybean interests. The Fund’s Shares trade in the secondary market on the NYSE Arca at prices that are lower or higher than their NAV per Share.

The investment objective of SOYB is to have the daily changes in percentage terms of the Shares’ NAV reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for three futures contracts for soybeans (“Soybean Futures Contracts”) that are traded on the CBOT. The three Soybean Futures Contracts will generally be: (1) second-to-expire CBOT Soybean Futures Contract, weighted 35%, (2) the third-to-expire CBOT Soybean Futures Contract, weighted 30%, and (3) the CBOT Soybean Futures Contract expiring in the November following the expiration month of the third-to-expire contract, weighted 35%.

The Fund commenced investment operations on September 19, 2011 and has a fiscal year ending December 31. The Fund’s sponsor is Teucrium Trading, LLC (the “Sponsor”). The Sponsor is responsible for the management of the Fund. The Sponsor is a member of the National Futures Association (the “NFA”) and became a commodity pool operator registered with the Commodity Futures Trading Commission (the “CFTC”) effective November 10, 2009.

On June 17, 2011, the Fund’s registration of 10,000,000 shares on Form S-1 was declared effective by the SEC. On September 19, 2011, the Fund listed its shares on the NYSE Arca under the ticker symbol “SOYB.” On the business day prior to that, the Fund issued 100,000 shares in exchange for $2,500,000 at the Fund’s initial NAV of $25 per share. The Fund also commenced investment operations on September 19, 2011 by purchasing soybean commodity futures contracts traded on the CBOT. On December 31, 2010, the Fund had four shares outstanding, which were owned by the Sponsor. On June 30, 2014, a subsequent registration statement for SOYB was declared effective by the SEC.

The accompanying unaudited financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X promulgated by the SEC and, therefore, do not include all information and footnote disclosures required under accounting principles generally accepted in the United States of America (“GAAP”). The financial information included herein is unaudited; however, such financial information reflects all adjustments which are, in the opinion of management, necessary for the fair presentation of the Fund’s financial statements for the interim period. It is suggested that these interim financial statements be read in conjunction with the financial statements and related notes included in the Trust’s Annual Report on Form 10-K, as well as the most recent Form S-1 filing, as applicable. The operating results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016.

Note 2 – Principal Contracts and Agreements

For custody services, the Funds will pay to U.S. Bank N.A. 0.0075% of average gross assets up to $1 billion, and .0050% of average gross assets over $1 billion, annually, plus certain per-transaction charges. For Transfer Agency, Fund Accounting and Fund Administration services, which are based on the total assets for all the Funds in the Trust, the Funds will pay to USBFS 0.06% of average gross assets on the first $250 million, 0.05% on the next $250 million, 0.04% on the next $500 million and 0.03% on the balance over $1 billion annually. A combined minimum annual fee of up to $64,500 for custody, transfer agency, accounting and administrative services is assessed per Fund. For the three months ended September 30, 2016 and 2015, the Fund recognized $7,291 and $69,982, respectively, for these services, which was recorded in custodian fees and expenses on the statements of operations; of these expenses $0 in 2016 and $69,982 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Fund recognized $19,231 and $133,982, respectively, for these services, which was recorded in custodian fees and expenses on the statements of operations; of these expenses $0 in 2016 and $133,982 in 2015 were waived by the Sponsor.

The Sponsor employs Foreside Fund Services, LLC (“Foreside” or the “Distributor”) as the Distributor for the Funds. The Distribution Services Agreement among the Distributor and the Sponsor calls for the Distributor to work with the Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials. The Distributor and the Sponsor have also entered into a Securities Activities and Service Agreement (the “SASA”) under which certain employees and officers of the Sponsor are licensed as registered representatives or registered principals of the Distributor, under Financial Industry Regulatory Authority (“FINRA”) rules. For its services as the Distributor, Foreside receives a fee of 0.01% of the Fund’s average daily net assets and an aggregate annual fee of $100,000 for all Teucrium Funds, along with certain expense reimbursements. For its services under the SASA, Foreside receives a fee of $5,000 per registered representative and $1,000 per registered location. For the three months ended September 30, 2016 and 2015, the Fund recognized $2,871 and $3,070, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations; of these expenses $0 in 2016 and $1,256 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Fund recognized $10,670 and $8,094, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations; of these expenses $0 in 2016 and $3,813 in 2015 were waived by the Sponsor.

Currently, ED&F Man serves as the Underlying Funds’ clearing broker to execute and clear the Underlying Funds’ futures and provide other brokerage-related services. ED&F Man is registered as a FCM with the U.S. CFTC and is a member of the NFA. ED&F Man is also registered as a broker/dealer with the U.S. Securities and Exchange Commission and is a member of the FINRA. ED&F Man is a clearing member of ICE Futures U.S., Inc., Chicago Board of Trade, Chicago Mercantile Exchange, New York Mercantile Exchange, and all other major United States commodity exchanges. For Corn, Soybean, Sugar and Wheat Futures Contracts ED&F Man, Jefferies and SG were paid $8.00 per round turn. Effective January 1, 2016, ED&F Man, increased the per round-term charge for futures contracts commission to $9.00. For the three months ended September 30, 2016 and 2015, the Fund recognized $0 and $1,683, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and paid for by the Fund. For the nine months ended September 30, 2016 and 2015, the Fund recognized $1,507 and $4,445, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and paid for by the Fund.

The sole Trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation. The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory Trust Act. For its services, the Trustee receives an annual fee of $3,300 from the Trust. For the three and nine months ended September 30, 2016, the Fund recognized $257 for these services, which was recorded in business permits and licenses on the statements of operations and was waived by the Sponsor. For the three and nine months ended September 30, 2015, the Fund did not recognize any expense for these services.

Note 3 – Summary of Significant Accounting Policies

Basis of Presentation

Revenue Recognition

Commodity futures contracts are recorded on the trade date. All such transactions are recorded on the identified cost basis and marked to market daily. Unrealized appreciation or depreciation on commodity futures contracts are reflected in the statements of assets and liabilities as the difference between the original contract amount and the fair market value as of the last business day of the year or as of the last date of the financial statements. Changes in the appreciation or depreciation between periods are reflected in the statements of operations. Interest on cash equivalents and deposits with the Futures Commission Merchant are recognized on the accrual basis. The Fund earns interest on its assets

denominated in U.S. dollars on deposit with the Futures Commission Merchant. In addition, the Fund earns interest on funds held at the custodian at prevailing market rates for such investments.

Brokerage Commissions

Brokerage commissions on all open commodity futures contracts are accrued on the trade date and on a full-turn basis.

Income Taxes

Creations and Redemptions

Authorized Purchasers may purchase Creation Baskets consisting of 25,000 shares from the Fund. The amount of the proceeds required to purchase a Creation Basket will be equal to the NAV of the shares in the Creation Basket determined as of 4:00 p.m. New York time on the day the order to create the basket is properly received.

As outlined in the most recent Form S-1 filing, 50,000 shares represents two Redemption Baskets for the Fund and a minimum level of shares.

Allocation of Shareholder Income and Losses

Profit or loss is allocated among the shareholders of the Fund in proportion to the number of shares each shareholder holds as of the close of each month.

Cash Equivalents

Cash equivalents are highly-liquid investments with maturity dates of 90 days or less when acquired. The Fund reported its cash equivalents in the statements of assets and liabilities at market value, or at carrying amounts that approximate fair value, because of their highly-liquid nature and short-term maturities. The Fund has these balances of its assets on deposit with banks. The Fund had a balance of $230,144 and $161,718 in money market funds at September 30, 2016 and December 31, 2015, respectively; these balances are included in cash and cash equivalents on the statements of assets and liabilities. Effective in the second quarter 2015, the Sponsor invested a portion of the available cash for the Fund in alternative demand-deposit savings accounts, which is classified as cash and not as a cash equivalent. The Fund had a balance of $12,267,749 as of September 30, 2016 and $5,776,106 as of December 31, 2015 in demand-deposit savings accounts. This change resulted in a reduction in the balance held in money market funds. Assets deposited with the bank may, at times, exceed federally insured limits.

Restricted Cash

On August 17, 2015 (the “Conversion Date”), U.S. Bank N.A. replaced The Bank of New York Mellon as the Custodian for the Funds. Per the amended agreement between the Sponsor and The Bank of New York Mellon dated August 14, 2015, certain cash amounts for each Fund, except in the case of TAGS, are to remain at The Bank of New York Mellon until amounts for services and early termination fees are paid. The amended agreement allows for payments for such amounts owed to be made through December 31, 2017. Cash balances that are held in custody at The Bank of New York Mellon under this amended agreement are reflected on the statements of assets and liabilities of the Fund and the Trust as restricted cash.

Due from/to Broker

Margin is the minimum amount of funds that must be deposited by a commodity interest trader with the trader’s broker to initiate and maintain an open position in futures contracts. A margin deposit acts to assure the trader’s performance of the futures contracts purchased or sold. Futures contracts are customarily bought and sold on initial margin that represents a very small percentage of the aggregate purchase or sales price of the contract. Because of such low margin requirements, price fluctuations occurring in the futures markets may create profits and losses that, in relation to the amount invested, are greater than are customary in other forms of investment or speculation. As discussed below, adverse price changes in the futures contract may result in margin requirements that greatly exceed the initial margin. In addition, the amount of margin required in connection with a particular futures contract is set from time to time by the exchange on which the contract is traded and may be modified from time to time by the exchange during the term of the contract. Brokerage firms, such as the Fund’s clearing brokers, carrying accounts for traders in commodity interest contracts generally require higher amounts of margin as a matter of policy to further protect themselves. Over-the-counter trading generally involves the extension of credit between counterparties, so the counterparties may agree to require the posting of collateral by one or both parties to address credit exposure.

Ongoing or “maintenance” margin requirements are computed each day by a trader’s clearing broker. When the market value of a particular open futures contract changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the broker. If the margin call is not met within a reasonable time, the broker may close out the trader’s position. With respect to the Fund’s trading, the Fund (and not its shareholders personally) is subject to margin calls.

Finally, many major U.S. exchanges have passed certain cross margining arrangements involving procedures pursuant to which the futures and options positions held in an account would, in the case of some accounts, be aggregated and margin requirements would be assessed on a portfolio basis, measuring the total risk of the combined positions.

Calculation of Net Asset Value

The Fund’s NAV is calculated by:

•	Taking the current market value of its total assets and

•	Subtracting any liabilities.

In determining the value of Soybean Futures Contracts, the administrator uses the CBOT closing price. The administrator determines the value of all other Fund investments as of the earlier of the close of the NYSE or 4:00 p.m. New York time. The value of over-the-counter soybean interests is determined based on the value of the commodity or futures contract underlying such soybean interest, except that a fair value may be determined if the Sponsor believes that the Fund is subject to significant credit risk relating to the counterparty to such soybean interest. For purposes of financial statements and reports, the Sponsor will recalculate the NAV where necessary to reflect the “fair value” of a Futures Contract when the Futures Contract closes at its price fluctuation limit for the day. Treasury securities held by the Fund are valued by the administrator using values received from recognized third-party vendors and dealer quotes. NAV includes any unrealized profit or loss on open soybean interests and any other income or expense accruing to the Fund but unpaid or not received by the Fund.

Sponsor Fee, Allocation of Expenses and Related Party Transactions

These aggregate common expenses include, but are not limited to, legal, auditing, accounting and financial reporting, tax-preparation, regulatory compliance, trading activities, and insurance costs, as well as fees paid to the Distributor, which are included in the related line item in the statements of operations. A portion of these aggregate common expenses are related to the Sponsor or related parties of principals of the Sponsor; these are necessary services to the Funds, which are primarily the cost of performing accounting and financial reporting, regulatory compliance, and trading activities that are directly attributable to the Fund. For the three months ended September 30, such expenses, which are primarily recorded in distribution and marketing fees on the statement of operations, totaled $33,624 in 2016 and $33,186 in 2015; of these amounts $10,720 in 2016 and $6,427 in 2015 were waived by the Sponsor. For the nine months ended September 30, such expenses, totaled $136,289 in 2016 and $87,504 in 2015; of these amounts, $10,720 in 2016 and $33,795 in 2015 were waived by the Sponsor. All asset-based fees and expenses for the Funds are calculated on the prior day’s net assets.

For the three months ended September 30, there were $63,113 in 2016 and $129,551 in 2015, respectively, of expenses identified on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the nine months ended September 30, there were $63,113 in 2016 and $243,723 in 2015, respectively, of expenses identified on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

Use of Estimates

Fair Value - Definition and Hierarchy

In determining fair value, the Fund uses various valuation approaches. In accordance with U.S. GAAP, a fair value hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows:

Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

used had a ready market for the financial instruments existed. Accordingly, the degree of judgment exercised by the Fund in determining fair value is greatest for financial instruments categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy, within which the fair value measurement in its entirety falls, is determined based on the lowest level input that is significant to the fair value measurement.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Fund’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Fund uses prices and inputs that are current as of the measurement date, including periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many financial instruments. This condition could cause a financial instrument to be reclassified to a lower level within the fair value hierarchy. When such a situation exists on a quarter close, the Sponsor will calculate the NAV on a particular day using the Level 1 valuation, but will later recalculate the NAV for the impacted Fund based upon the valuation inputs from these alternative verifiable sources (Level 2 or Level 3) and will report such NAV in its applicable financial statements and reports.

On September 30, 2016 and December 31, 2015, in the opinion of the Trust and the Fund, the reported value of the Soybean Futures Contracts traded on the CBOT fairly reflected the value of the Soybean Futures Contracts held by the Fund, with no adjustments necessary. The determination is made as of the settlement of the futures contracts on the last day of trading for the reporting period. In making the determination of a Level 1 or Level 2 transfer, the Fund considers the average volume of the specific underlying futures contracts traded on the relevant exchange for the periods being reported.

For the nine months ended September 30, 2016 and for the year ended December 31, 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

Expenses

Expenses are recorded using the accrual method of accounting.

Net Income (Loss) per Share

Net income (loss) per Share is the difference between the NAV per unit at the beginning of each period and at the end of each period. The weighted average number of Shares outstanding was computed for purposes of disclosing net income (loss) per weighted average Share. The weighted average Shares are equal to the number of Shares outstanding at the end of the period, adjusted proportionately for Shares created or redeemed based on the amount of time the Shares were outstanding during such period.

New Accounting Pronouncements

Note 4 – Fair Value Measurements

September 30, 2016

							Balance as of
Assets:	Level 1		Level 2		Level 3		September, 2016
Cash equivalents	$	230,144	$	—	$	—	$	230,144
Soybean futures contracts		143,413		—		—		143,413
Total	$	373,557	$	—	$	—	$	373,557

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		September 30, 2015
Soybean futures contracts	$	387,000	$	—	$	—	$	387,000

December 31, 2015

							Balance as of
Assets:	Level 1		Level 2		Level 3		December 31, 2015
Cash equivalents	$	161,718	$	—	$	—	$	161,718
Soybean futures contracts		16,175		—		—		16,175
Total	$	177,893	$	—	$	—	$	177,893

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		December 31, 2015
Soybean futures contracts	$	238,662	$	—	$	—	$	238,662

For the nine months ended September 30, 2016 and year ended December 31, 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

See the Fair Value - Definition and Hierarchy section in Note 3 above for an explanation of the transfers into and out of each level of the fair value hierarchy.

Note 5 – Derivative Instruments and Hedging Activities

Futures Contracts

The Commodity Exchange Act requires an FCM to segregate all customer transactions and assets from the FCM’s proprietary activities. A customer’s cash and other equity deposited with an FCM are considered commingled with all other customer funds subject to the FCM’s segregation requirements. In the event of an FCM’s insolvency, recovery may be limited to the Fund’s pro rata share of segregated customer funds available. It is possible that the recovery amount could be less than the total of cash and other equity deposited.

The following table discloses information about offsetting assets and liabilities presented in the statements of assets and liabilities to enable users of these financial statements to evaluate the effect or potential effect of netting arrangements for recognized assets and liabilities. These recognized assets and liabilities are presented as defined in FASB ASU No. 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities” and subsequently clarified in FASB ASU 2013-01 “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.”

Offsetting of Financial Assets and Derivative Assets as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Assets

Liabilities

Available for Offset

to Broker

Net Amount

Commodity price

Soybean futures contracts

143,413

Offsetting of Financial Liabilities and Derivative Liabilities as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and
Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Liabilities

Available for Offset

from Broker

Net Amount

Commodity price

Soybean futures contracts

387,000

143,413

222,487

Offsetting of Financial Assets and Derivative Assets as of December 31, 2015

	(i)		(ii)		(iii) = (i) – (ii)		(iv)				(v) = (iii) – (iv)

							Gross Amount Not Offset in the Statement of Assets and Liabilities
Description	Gross Amount of Recognized Assets		Gross Amount Offset in the Statement of Assets and Liabilities		Net Amount Presented in the Statement of Assets and Liabilities		Futures Contracts Available for Offset		Collateral, Due to Broker		Net Amount
Commodity price
Soybean futures contracts	$	16,175	$	-	$	16,175	$	16,175	$	-	$	-

Offsetting of Financial Liabilities and Derivative Liabilities as of December 31, 2015

	(i)		(ii)		(iii) = (i) – (ii)		(iv)				(v) = (iii) – (iv)

							Gross Amount Not Offset in the Statement of Assets and Liabilities
Description	Gross Amount of Recognized Liabilities		Gross Amount Offset in the Statement of Assets and Liabilities		Net Amount Presented in the Statement of Assets and Liabilities		Futures Contracts Available for Offset		Collateral, Due from Broker		Net Amount
Commodity price
Soybean futures contracts	$	238,662	$	-	$	238,662	$	16,175	$	222,487	$	-

The following is a summary of realized and unrealized gains and losses of the derivative instruments utilized by the Fund:

Three months ended September 30, 2016

Primary Underlying Risk	Realized Gain on Commodity Futures Contracts		Net Change in Unrealized Appreciation or Depreciation on Commodity Futures Contracts
Commodity price
Soybean futures contracts	$	28,163	$	(1,612,025)

Three months ended September 30, 2015

Primary Underlying Risk	Realized Loss on Commodity Futures Contracts		Net Change in Unrealized Appreciation or Depreciation on Commodity Futures Contracts
Commodity price
Soybean futures contracts	$	(356,775)	$	(622,013)

Nine months ended September 30, 2016

Primary Underlying Risk	Realized Gain on Commodity Futures Contracts		Net Change in Unrealized Appreciation or Depreciation on Commodity Futures Contracts
Commodity price
Soybean futures contracts	$	990,062	$	(21,100)

Nine months ended September 30, 2015

Primary Underlying Risk

Realized Loss on

Commodity Futures Contracts

Net Change in Unrealized

Appreciation or Depreciation on

Commodity Futures Contracts

Commodity price

Soybean futures contracts

(1,091,489

)

(27,462)

Volume of Derivative Activities

The average notional market value categorized by primary underlying risk for all futures contracts held were $12.4 million and $10.9 million for the three and nine months ended September 30, 2016 and $7.3 million and $7.2 million for the three and nine months ended September 30, 2015.

Note 6 – Financial Highlights

The following tables present per unit performance data and other supplemental financial data for the three and nine months ended September 30, 2016 and 2015. This information has been derived from information presented in the financial statements. This information has been derived from information presented in the financial statements and is presented with total expenses gross of expenses waived by the Sponsor and with total expenses net of expenses waived by the Sponsor, as appropriate.

Per Share Operation Performance	Three months ended September 30, 2016			Three months ended September 30, 2015			Nine months ended September 30, 2016			Nine months ended September 30, 2015
Net asset value at beginning of period	$	21.37		$	20.60		$	17.34		$	20.79
Income from investment operations:
Investment income		0.02			0.01			0.07			0.01
Net realized and unrealized (loss) gain on commodity futures contracts		(2.67	)		(2.45	)		1.69			(2.40	)
Total expenses		(0.19	)		(0.18	)		(0.57	)		(0.42	)
Net (decrease) increase in net asset value		(2.84	)		(2.62	)		1.19			(2.81	)
Net asset value at end of period	$	18.53		$	17.98		$	18.53		$	17.98
Total Return		(13.29	)%		(12.72	)%		6.86	%		(13.52	)%
Ratios to Average Net Assets (Annualized)
Total expenses		6.04	%		10.67	%		4.79	%		7.31	%
Total expenses, net		4.03	%		3.74	%		4.03	%		2.91	%
Net investment loss		(3.49	)%		(3.49	)%		(3.50	)%		(2.78	)%

Note 7 – Organizational and Offering Costs

Note 8 – Subsequent Events

TEUCRIUM SUGAR FUND

STATEMENTS OF ASSETS AND LIABILITIES

	September 30, 2016		December 31, 2015
	(Unaudited)
Assets
Cash and cash equivalents	$	6,796,316	$	4,932,791
Interest receivable		830		49
Restricted cash		87,068		142,457
Other assets		29,908		11,942
Equity in trading accounts:
Commodity futures contracts		699,373		364,056
Due from broker		-		58,431
Total equity in trading accounts		699,373		422,487
Total assets		7,613,495		5,509,726

Liabilities
Management fee payable to Sponsor		5,864		-
Other liabilities		-		1,063
Equity in trading accounts:
Commodity futures contracts		29,882		-
Due to broker		250,600		-
Total equity in trading accounts		280,482		-
Total liabilities		286,346		1,063

Net assets	$	7,327,149	$	5,508,663

Shares outstanding		500,004		550,004

Net asset value per share	$	14.65	$	10.02

Market value per share	$	14.48	$	10.06

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SUGAR FUND

SCHEDULE OF INVESTMENTS

September 30, 2016

(Unaudited)

			Percentage of
Description: Assets	Fair Value		Net Assets			Shares

Cash equivalents
Money market funds
Fidelity Institutional Money Market Funds - Government Portfolio (cost $239,864)	$	239,864		3.27	%		239,864

						Notional Amount
						(Long Exposure)
Commodity futures contracts
United States sugar futures contracts
ICE sugar futures MAY17 (103 contracts)	$	213,730		2.91	%	$	2,556,378
ICE sugar futures MAR18 (113 contracts)		485,643		6.63	%		2,575,496
Total commodity futures contracts	$	699,373		9.54	%	$	5,131,874

				Percentage of		Notional Amount
Description: Liabilities		Fair Value		Net Assets		(Long Exposure)

Commodity futures contracts
United States sugar futures contracts
ICE sugar futures JUL17 (92 contracts)	$	29,882		0.41	%	$	2,195,782

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SUGAR FUND

SCHEDULE OF INVESTMENTS

December 31, 2015

			Percentage of
Description: Assets	Fair Value		Net Assets			Shares

Cash equivalents
Money market funds
Fidelity Institutional Prime Money Market Portfolio (cost $297,460)	$	297,460		5.40	%		297,460

						Notional Amount
						(Long Exposure)

Commodity futures contracts
United States sugar futures contracts
ICE sugar futures MAY16 (115 contracts)	$	151,973		2.76	%	$	1,921,696
ICE sugar futures JUL16 (101 contracts)		199,517		3.62			1,656,077
ICE sugar futures MAR17 (114 contracts)		12,566		0.23			1,927,968
Total commodity futures contracts	$	364,056		6.61	%	$	5,505,741

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SUGAR FUND

STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Income
Realized and unrealized gain (loss) on trading of commodity futures contracts:
Realized gain (loss) on commodity futures contracts	$	948,483		$	(446,791	)	$	1,957,357		$	(1,286,051	)
Net change in unrealized appreciation or depreciation on commodity futures contracts		(18,088	)		116,167			305,435			312,379
Interest income		9,517			2,358			23,050			3,507
Total income (loss)		939,912			(328,266	)		2,285,842			(970,165	)

Expenses
Management fees		18,006			9,353			44,723			24,206
Professional fees		21,511			24,555			39,020			50,907
Distribution and marketing fees		28,782			14,385			91,874			22,632
Custodian fees and expenses		5,786			70,194			13,137			134,194
Business permits and licenses fees		6,136			6,657			12,697			7,539
General and administrative expenses		4,649			3,002			11,702			3,378
Brokerage commissions		2,826			-			6,498			-
Other expenses		1,220			679			4,619			1,426
Total expenses		88,916			128,825			224,270			244,282

Expenses waived by the Sponsor		(48,043	)		(109,353	)		(121,429	)		(197,178	)

Total expenses, net		40,873			19,472			102,841			47,104

Net income (loss)	$	899,039		$	(347,738	)	$	2,183,001		$	(1,017,269	)

Net income (loss) per share	$	1.73		$	(0.74	)	$	4.63		$	(3.08	)
Net income (loss) per weighted average share	$	1.67		$	(0.79	)	$	4.22		$	(2.99	)
Weighted average shares outstanding		538,319			439,134			517,887			340,022

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SUGAR FUND

STATEMENTS OF CHANGES IN NET ASSETS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Operations
Net income (loss)	$	2,183,001		$	(1,017,269	)
Capital transactions
Issuance of Shares		2,487,753			2,278,365
Redemption of Shares		(2,852,268	)		(204,438	)
Total capital transactions		(364,515	)		2,073,927
Net change in net assets		1,818,486			1,056,658

Net assets, beginning of period	$	5,508,663		$	2,661,212

Net assets, end of period	$	7,327,149		$	3,717,870

Net asset value per share at beginning of period	$	10.02		$	11.83

Net asset value per share at end of period	$	14.65		$	8.75

Creation of Shares		225,000			225,000
Redemption of Shares		275,000			25,000

The accompanying notes are an integral part of these financial statements.

TEUCRIUM SUGAR FUND

STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine months ended			Nine months ended
	September 30, 2016			September 30, 2015
Cash flows from operating activities:
Net income (loss)	$	2,183,001		$	(1,017,269	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net change in unrealized appreciation or depreciation on commodity futures contracts		(305,435	)		(312,379	)
Changes in operating assets and liabilities:
Due from broker		58,431			108,340
Interest receivable		(781	)		128
Restricted cash		55,389			(142,457	)
Other assets		(17,966	)		(8,694	)
Due to broker		250,600			-
Management fee payable to Sponsor		5,864			-
Other liabilities		(1,063	)		(470	)
Net cash provided by (used in) operating activities		2,228,040			(1,372,801	)

Cash flows from financing activities:
Proceeds from sale of Shares		2,487,753			2,278,365
Redemption of Shares		(2,852,268	)		(204,438	)
Net cash (used in) provided by financing activities		(364,515	)		2,073,927

Net change in cash and cash equivalents		1,863,525			701,126
Cash and cash equivalents, beginning of period		4,932,791			2,489,338
Cash and cash equivalents, end of period	$	6,796,316		$	3,190,464

The accompanying notes are an integral part of these financial statements.

NOTES TO FINANCIAL STATEMENTS

September 30, 2016

(Unaudited)

Note 1 – Organization and Operation

Teucrium Sugar Fund (referred to herein as “CANE” or the “Fund”) is a commodity pool that is a series of Teucrium Commodity Trust (“Trust”), a Delaware statutory trust formed on September 11, 2009. The Fund issues common units, called the “Shares,” representing fractional undivided beneficial interests in the Fund. The Fund continuously offers Creation Baskets consisting of 25,000 Shares at their Net Asset Value (“NAV”) to “Authorized Purchasers” through Foreside Fund Services, LLC, which is the distributor for the Fund (the “Distributor”). Authorized Purchasers sell such Shares, which are listed on the New York Stock Exchange (“NYSE”) Arca under the symbol “CANE,” to the public at per-Share offering prices that reflect, among other factors, the trading price of the Shares on the NYSE Arca, the NAV of the Fund at the time the Authorized Purchaser purchased the Creation Baskets and the NAV at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the markets for sugar interests. The Fund’s Shares trade in the secondary market on the NYSE Arca at prices that are lower or higher than their NAV per Share.

The investment objective of CANE is to have the daily changes in percentage terms of the Shares’ NAV reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for three futures contracts for sugar (“Sugar Futures Contracts”) that are traded on ICE Futures US (“ICE Futures”), specifically: (1) the second-to-expire Sugar No. 11 Futures Contract (a “Sugar No. 11 Futures Contract”), weighted 35%, (2) the third-to-expire Sugar No. 11 Futures Contract, weighted 30%, and (3) the Sugar No. 11 Futures Contract expiring in the March following the expiration month of the third-to-expire contract, weighted 35%.

On June 17, 2011, the Fund’s registration of 10,000,000 shares on Form S-1 was declared effective by the U.S. Securities and Exchange Commission (“SEC”). On September 19, 2011, the Fund listed its shares on the NYSE Arca under the ticker symbol “CANE.” On the business day prior to that, the Fund issued 100,000 shares in exchange for $2,500,000 at the Fund’s initial NAV of $25 per share. The Fund also commenced investment operations on September 19, 2011 by purchasing commodity futures contracts traded on ICE. On December 31, 2010, the Fund had four shares outstanding, which were owned by the Sponsor. On June 30, 2014, a subsequent registration for CANE was declared effective by the SEC.

The accompanying unaudited financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X promulgated by the SEC and, therefore, do not include all information and footnote disclosures required under accounting principles generally accepted in the United States of America (“GAAP”). The financial information included herein is unaudited; however, such financial information reflects all adjustments which are, in the opinion of management, necessary for the fair presentation of the Fund’s financial statements for the interim period. It is suggested that these interim financial statements be read in conjunction with the financial statements and related notes included in the Trust’s Annual Report on Form 10-K, as well as the most recent Form S-1 filing, as applicable. The operating results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016.

Note 2 – Principal Contracts and Agreements

For custody services, the Funds will pay to U.S. Bank N.A. 0.0075% of average gross assets up to $1 billion, and .0050% of average gross assets over $1 billion, annually, plus certain per-transaction charges. For Transfer Agency, Fund Accounting and Fund Administration services, which are based on the total assets for all the Funds in the Trust, the Funds will pay to USBFS 0.06% of average gross assets on the first $250 million, 0.05% on the next $250 million, 0.04% on the next $500 million and 0.03% on the balance over $1 billion annually. A combined minimum annual fee of up to $64,500 for custody, transfer agency, accounting and administrative services is assessed per Fund. For the three months ended September 30, 2016 and 2015, the Fund recognized $5,786 and $70,194, respectively, for these services, which is recorded in custodian fees and expenses on the statements of operations; of these expenses $3,868 in 2016 and $70,194 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Fund recognized $13,137 and $134,194, respectively, for these services, which was recorded in custodian fees and expenses on the statements of operations; of these expenses $9,694 in 2016 and $134,194 in 2015 were waived by the Sponsor.

The Sponsor employs Foreside Fund Services, LLC (“Foreside” or the “Distributor”) as the Distributor for the Funds. The Distribution Services Agreement among the Distributor and the Sponsor calls for the Distributor to work with the Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising materials. The Distributor and the Sponsor have also entered into a Securities Activities and Service Agreement (the “SASA”) under which certain employees and officers of the Sponsor are licensed as registered representatives or registered principals of the Distributor, under Financial Industry Regulatory Authority (“FINRA”) rules. For its services as the Distributor, Foreside receives a fee of 0.01% of the Fund’s average daily net assets and an aggregate annual fee of $100,000 for all Teucrium Funds, along with certain expense reimbursements. For its services under the SASA, Foreside receives a fee of $5,000 per registered representative and $1,000 per registered location. For the three months ended September 30, 2016 and 2015, the Fund recognized $1,578 and $1,016, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations; of these expenses $1,578 in 2016 and $397 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, the Fund recognized $6,606 and $2,451, respectively, for these services, which was recorded in distribution and marketing fees on the statements of operations; of these expenses $4,047 in 2016 and $867 in 2015 were waived by the Sponsor.

Currently, ED&F Man serves as the Underlying Funds’ clearing broker to execute and clear the Underlying Funds’ futures and provide other brokerage-related services. ED&F Man is registered as a FCM with the U.S. CFTC and is a member of the NFA. ED&F Man is also registered as a broker/dealer with the U.S. Securities and Exchange Commission and is a member of the FINRA. ED&F Man is a clearing member of ICE Futures U.S., Inc., Chicago Board of Trade, Chicago Mercantile Exchange, New York Mercantile Exchange, and all other major United States commodity exchanges. For Corn, Soybean, Sugar and Wheat Futures Contracts ED&F Man, Jefferies and SG were paid $8.00 per round turn. Effective January 1, 2016, ED&F Man, increased the per round-term charge for futures contracts commission to $9.00. For the three months ended September 30, 2016 and 2015, the Fund recognized $2,826 and $0, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and paid for by the Fund. For the nine months ended September 30, 2016 and 2015, the Fund recognized $6,498 and $0, respectively, for these services, which was recorded in brokerage commissions on the statements of operations and paid for by the Fund.

The sole Trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation. The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory Trust Act. For its services, the Trustee receives an annual fee of $3,300 from the Trust. For the three and nine months ended September 30, 2016, the Fund recognized $133 for these services and was recorded in business permits and licenses on the statements of operations and was waived by the Sponsor. For the three and nine months ended September 30, 2015, the Fund did not recognize any expense for these services.

Note 3 – Summary of Significant Accounting Policies

Basis of Presentation

Revenue Recognition

Commodity futures contracts are recorded on the trade date. All such transactions are recorded on the identified cost basis and marked to market daily. Unrealized appreciation or depreciation on commodity futures contracts are reflected in the statements of assets and liabilities as the difference between the original contract amount and the fair market value as of the last business day of the year or as of the last date of the financial statements. Changes in the appreciation or depreciation between periods are reflected in the statements of operations. Interest on cash equivalents and deposits with the Futures Commission Merchant are recognized on the accrual basis. The Fund earns interest on its assets

denominated in U.S. dollars on deposit with the Futures Commission Merchant. In addition, the Fund earns interest on funds held at the custodian at prevailing market rates for such investments.

Brokerage Commissions

Brokerage commissions on all open commodity futures contracts are accrued on the trade date and on a full-turn basis.

Income Taxes

The Fund is required to determine whether a tax position is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Fund files an income tax return in the U.S. federal jurisdiction, and may file income tax returns in various U.S. states and foreign jurisdictions. For all tax years 2013 to 2015, the Fund remains subject to income tax examinations by major taxing authorities. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. De-recognition of a tax benefit previously recognized results in the Fund recording a tax liability that reduces net assets. Based on its analysis, the Fund has determined that it has not incurred any liability for tax benefits as of September 30, 2016 and for the years ended December 31, 2015, 2014 and 2013. However, the Fund’s conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, ongoing analysis of and changes to tax laws, regulations, and interpretations thereof.

Creations and Redemptions

As outlined in the most recent Form S-1 filing, 50,000 shares represents two Redemption Baskets for the Fund and a minimum level of shares.

Allocation of Shareholder Income and Losses

Profit or loss is allocated among the shareholders of the Fund in proportion to the number of shares each shareholder holds as of the close of each month.

Cash Equivalents

Cash equivalents are highly-liquid investments with maturity dates of 90 days or less when acquired. The Fund reported its cash equivalents in the statements of assets and liabilities at market value, or at carrying amounts that approximate fair value, because of their highly-liquid nature and short-term maturities. The Fund has these balances of its assets on deposit with banks. The Fund had a balance of $239,864 and $297,460 in money market funds at September 30, 2016 and December 31, 2015, respectively; these balances are included in cash and cash equivalents on the statements of assets and liabilities. Effective in the second quarter 2015, the Sponsor invested a portion of the available cash for the Fund in alternative demand-deposit savings accounts, which is classified as cash and not as a cash equivalent. The Fund had a balance of $6,556,452 as of September 30, 2016 and $4,635,331 as of December 31, 2015 in a demand-deposit savings account. This change resulted in a reduction in the balance held in money market funds. Assets deposited with financial institutions, at times, exceed federally insured limits.

Restricted Cash

On August 17, 2015 (the “Conversion Date”), U.S. Bank N.A. replaced The Bank of New York Mellon as the Custodian for the Funds. Per the amended agreement between the Sponsor and The Bank of New York Mellon dated August 14, 2015, certain cash amounts for each Fund, except in the case of TAGS, are to remain at The Bank of New York Mellon until amounts for services and early termination fees are paid. The amended agreement allows for payments for such amounts owed to be made through December 31, 2017. Cash balances that are held in custody at The Bank of New York Mellon under this amended agreement are reflected on the statements of assets and liabilities of the Fund and the Trust as restricted cash.

Due from/to Broker

Margin is the minimum amount of funds that must be deposited by a commodity interest trader with the trader’s broker to initiate and maintain an open position in futures contracts. A margin deposit acts to assure the trader’s performance of the futures contracts purchased or sold. Futures contracts are customarily bought and sold on initial margin that represents a very small percentage of the aggregate purchase or sales price of the contract. Because of such low margin requirements, price fluctuations occurring in the futures markets may create profits and losses that, in relation to the amount invested, are greater than are customary in other forms of investment or speculation. As discussed below, adverse price changes in the futures contract may result in margin requirements that greatly exceed the initial margin. In addition, the amount of margin required in connection with a particular futures contract is set from time to time by the exchange on which the contract is traded and may be modified from time to time by the exchange during the term of the contract. Brokerage firms, such as the Fund’s clearing brokers, carrying accounts for traders in commodity interest contracts generally require higher amounts of margin as a matter of policy to further protect themselves. Over-the-counter trading generally involves the extension of credit between counterparties, so the counterparties may agree to require the posting of collateral by one or both parties to address credit exposure.

Ongoing or “maintenance” margin requirements are computed each day by a trader’s clearing broker. When the market value of a particular open futures contract changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the broker. If the margin call is not met within a reasonable time, the broker may close out the trader’s position. With respect to the Fund’s trading, the Fund (and not its shareholders personally) is subject to margin calls.

Finally, many major U.S. exchanges have passed certain cross margining arrangements involving procedures pursuant to which the futures and options positions held in an account would, in the case of some accounts, be aggregated and margin requirements would be assessed on a portfolio basis, measuring the total risk of the combined positions.

Calculation of Net Asset Value

The Fund’s NAV is calculated by:

•

Taking the current market value of its total assets and

•

Subtracting any liabilities.

In determining the value of Sugar Futures Contracts, the administrator uses the ICE closing price. The administrator determines the value of all other Fund investments as of the earlier of the close of the NYSE or 4:00 p.m. New York time. The value of over-the-counter sugar interests is determined based on the value of the commodity or futures contract underlying such sugar interest, except that a fair value may be determined if the Sponsor believes that the Fund is subject to significant credit risk relating to the counterparty to such sugar interest. For purposes of financial statements and reports, the Sponsor will recalculate the NAV where necessary to reflect the “fair value” of a Futures Contract when the Futures Contract closes at its price fluctuation limit for the day. Treasury securities held by the Fund are valued by the administrator using values received from recognized third-party vendors and dealer quotes. NAV includes any unrealized profit or loss on open sugar interests and any other income or expense accruing to the Fund but unpaid or not received by the Fund.

Sponsor Fee, Allocation of Expenses and Related Party Transactions

These aggregate common expenses include, but are not limited to, legal, auditing, accounting and financial reporting, tax-preparation, regulatory compliance, trading activities, and insurance costs, as well as fees paid to the Distributor, which are included in the related line item in the statements of operations. A portion of these aggregate common expenses are related to the Sponsor or related parties of principals of the Sponsor; these are necessary services to the Funds, which are primarily the cost of performing accounting and financial reporting, regulatory compliance, and trading activities that are directly attributable to the Fund. For the three months ended September 30, 2016 and 2015, such expenses, which are primarily recorded in distribution and marketing fees on the statements of operations, totaled $18,520 in 2016 and $10,985 in 2015; of these amounts, $18,520 in 2016 and $5,953 in 2015 were waived by the Sponsor. For the nine months ended September 30, 2016 and 2015, such expenses, totaled $86,877 in 2016 and $26,742 in 2015; of these amounts, $55,587 in 2016 and $13,048 in 2015 were waived by the Sponsor. All asset-based fees and expenses for the Funds are calculated on the prior day’s net assets.

For the three months ended September 30, there were $48,043 in 2016 and $109,353 in 2015, respectively, of expenses that were identified on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

For the nine months ended September 30, there were $121,429 in 2016 and $197,178 in 2015, respectively, of expenses that were identified on the statements of operations of the Fund as expenses that were waived by the Sponsor. The Sponsor has determined that there would be no recovery sought for these amounts in any future period.

Use of Estimates

Fair Value - Definition and Hierarchy

Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Fund’s own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. The Fund uses prices and inputs that are current as of the measurement date, including periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many financial instruments. This condition could cause a financial instrument to be reclassified to a lower level within the fair value hierarchy. When such a situation exists on a quarter close, the Sponsor will calculate the NAV on a particular day using the Level 1 valuation, but will later recalculate the NAV for the impacted Fund based upon the valuation inputs from these alternative verifiable sources (Level 2 or Level 3) and will report such NAV in its applicable financial statements and reports.

On September 30, 2016 and December 31, 2015, in the opinion of the Trust and the Fund, the reported value of the Sugar Futures Contracts traded on the ICE fairly reflected the value of the Sugar Futures Contracts held by the Fund, and no adjustments were necessary. The determination is made as of the settlement of the futures contracts on the last day of trading for the reporting period. In making the determination of a Level 1 or Level 2 transfer, the Fund considers the average volume of the specific underlying futures contracts traded on the relevant exchange for the periods being reported.

For the nine months ended September 30, 2016 and year ended December 31, 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

Net Income (Loss) per Share

New Accounting Pronouncements

Note 4 – Fair Value Measurements

The Fund’s assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy as described in the Fund’s significant accounting policies in Note 3. The following table presents information about the Fund’s assets and liabilities measured at fair value as of September 30, 2016 and December 31, 2015:

September 30, 2016

							Balance as of
Assets:	Level 1		Level 2		Level 3		September 30, 2016
Cash equivalents	$	239,864	$	-	$	-	$	239,864
Sugar futures contracts		699,373		-		-		699,373
Total	$	939,237	$	-	$	-	$	939,237

							Balance as of
Liabilities:	Level 1		Level 2		Level 3		September 30, 2016
Sugar futures contracts	$	29,882	$	-	$	-	$	29,882

December 31, 2015

							Balance as of
Assets:	Level 1		Level 2		Level 3		December 31, 2015
Cash equivalents	$	297,460	$	-	$	-	$	297,460
Sugar futures contracts		364,056		-		-		364,056
Total	$	661,516	$	-	$	-	$	661,516

For the nine months ended September 30, 2016 and year ended December 31, 2015, the Fund did not have any significant transfers between any of the levels of the fair value hierarchy.

See the Fair Value - Definition and Hierarchy section in Note 3 above for an explanation of the transfers into and out of each level of the fair value hierarchy.

Note 5 – Derivative Instruments and Hedging Activities

risks. In addition to its primary underlying risks, the Fund is also subject to additional counterparty risk due to inability of its counterparties to meet the terms of their contracts. For the nine months ended September 30, 2016 and year ended December 31, 2015, the Fund invested only in commodity futures contracts.

Futures Contracts

The Commodity Exchange Act requires an FCM to segregate all customer transactions and assets from the FCM’s proprietary activities. A customer’s cash and other equity deposited with an FCM are considered commingled with all other customer funds subject to the FCM’s segregation requirements. In the event of an FCM’s insolvency, recovery may be limited to the Fund’s pro rata share of segregated customer funds available. It is possible that the recovery amount could be less than the total of cash and other equity deposited.

The following table discloses information about offsetting assets and liabilities presented in the statements of assets and liabilities to enable users of these financial statements to evaluate the effect or potential effect of netting arrangements for recognized assets and liabilities. These recognized assets and liabilities are presented as defined in FASB ASU No. 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities” and subsequently clarified in FASB ASU 2013-01 “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.”

Offsetting of Financial Assets and Derivative Assets as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Assets

Liabilities

Available for Offset

to Broker

Net Amount

Commodity price

Sugar futures contracts

699,373

29,882

250,600

418,891

Offsetting of Financial Liabilities and Derivative Liabilities as of September 30, 2016

(i)

(ii)

(iii) = (i) – (ii)

(iv)

(v) = (iii) – (iv)

Gross Amount Not Offset in the

Statement of Assets and Liabilities

Gross Amount

Net Amount

Offset in the

Presented in the

Gross Amount

Statement of

of Recognized

Assets and

Futures Contracts

Collateral, Due

Description

Liabilities

Available for Offset

from Broker

Net Amount

Commodity price

Sugar futures contracts

29,882

Offsetting of Financial Assets and Derivative Assets as of December 31, 2015

	(i)		(ii)		(iii) = (i) – (ii)			(iv)			(v) = (iii) – (iv)

								Gross Amount Not Offset in the
								Statement of Assets and Liabilities
Description	Gross Amount of Recognized Assets		Gross Amount Offset in the Statement of Assets and Liabilities		Net Amount Presented in the Statement of Assets and Liabilities		Futures Contracts Available for Offset		Collateral, Due to Broker		Net Amount
Commodity price
Sugar futures contracts	$	364,056	$	-	$	364,056	$	-	$	-	$	364,056

Three months ended September 30, 2016

Primary Underlying Risk

Realized Gain on

Commodity Futures Contracts

Net Change in Unrealized

Appreciation or Depreciation on

Commodity Futures Contracts

Commodity price

Sugar futures contracts

948,483

(18,088)

Three months ended September 30, 2015

Primary Underlying Risk

Realized Loss on

Commodity Futures Contracts

Net Change in Unrealized

Appreciation or Depreciation on

Commodity Futures Contracts

Commodity price

Sugar futures contracts

(446,791

)

116,167

Nine months ended September 30, 2016

Primary Underlying Risk

Realized Gain on

Commodity Futures Contracts

Net Change in Unrealized

Appreciation or Depreciation on

Commodity Futures Contracts

Commodity price

Sugar futures contracts

1,957,357

305,435

Nine months ended September 30, 2015

Primary Underlying Risk

Realized Loss on

Commodity Futures Contracts

Net Change in Unrealized

Appreciation or Depreciation on

Commodity Futures Contracts

Commodity price

Sugar futures contracts

(1,286,051

)

312,379

Volume of Derivative Activities

The average notional market value categorized by primary underlying risk for all futures contracts held were $7.2 million and $5.8 million for the three and nine months ended September 30, 2016 and $3.7 million and $3.4 million for the same periods in 2015.

Note 6 – Financial Highlights

The following table presents per unit performance data and other supplemental financial data for the three and nine months ended September 30, 2016 and 2015. This information has been derived from information presented in the financial statements. This information has been derived from information presented in the financial statements and is presented with total expenses gross of expenses waived by the Sponsor and with total expenses net of expenses waived by the Sponsor, as appropriate.

	Three months ended			Three months ended			Nine months ended			Nine months ended
Per Share Operation Performance	September 30, 2016			September 30, 2015			September 30, 2016			September 30, 2015
Net asset value at beginning of period	$	12.92		$	9.49		$	10.02		$	11.83
Income from investment operations:
Income		0.02			0.00			0.04			0.01
Net realized and unrealized gain (loss) on commodity futures contracts		1.79			(0.70	)		4.79			(2.95	)
Total expenses		(0.08	)		(0.04	)		(0.20	)		(0.14	)
Net increase (decrease) in net asset value		1.73			(0.74	)		4.63			(3.08	)
Net asset value at end of period	$	14.65		$	8.75		$	14.65		$	8.75
Total Return		13.39	%		(7.80	)%		46.21	%		(26.04	)%
Ratios to Average Net Assets (Annualized)
Total expenses		4.94	%		13.56	%		5.01	%		10.03	%
Total expenses, net		2.27	%		2.05	%		2.30	%		1.93	%
Net investment loss		(1.74	)%		(1.80	)%		(1.78	)%		(1.79	)%

Note 7 – Organizational and Offering Costs

Expenses incurred in organizing of the Trust and the initial offering of the Shares of the Fund, including applicable SEC registration fees, were borne directly by the Sponsor. The Fund will not be obligated to reimburse the Sponsor.

Note 8 – Subsequent Events

TEUCRIUM WHEAT FUND

STATEMENTS OF ASSETS AND LIABILITIES

	September 30, 2016		December 31, 2015
Assets	(Unaudited)

Cash and cash equivalents	$	51,459,513	$	24,579,091
Interest receivable		6,303		297
Restricted cash		-		22,610
Other assets		243,064		153,564
Equity in trading accounts:
Due from broker		7,547,888		3,721,388
Total assets		59,256,768		28,476,950

Liabilities
Management fee payable to Sponsor		44,831		23,226
Payable for shares redeemed		541,380		-
Equity in trading accounts:
Commodity futures contracts		4,032,213		1,924,464
Total liabilities		4,618,424		1,947,690

Net assets	$	54,638,344	$	26,529,260

Shares outstanding		7,600,004		2,900,004

Net asset value per share	$	7.19	$	9.15

Market value per share	$	7.19	$	9.14

The accompanying notes are an integral part of these financial statements.

TEUCRIUM WHEAT FUND

SCHEDULE OF INVESTMENTS
September 30, 2016

(Unaudited)

Percentage of

Description: Assets

Fair Value

Net Assets

Shares

Cash equivalents

Money market funds

Fidelity Institutional Money Market Funds - Government Portfolio (cost $1,127,591)

1,127,591

2.06

1,127,591

Percentage of

Notional Amount

Description: Liabilities

Fair Value