Exchange for physical (EFP) - Financial definition
Concise definition of the term exchange for physical
Agreement between a party holding a long futures position, and a party holding a corresponding short position, to enter in a bilateral contract specifying the terms of physical delivery (location and price) of the underlying commodity.
Comprehensive definition of the term exchange for physical
The two counterparties notify the clearing house of the quantity and price negotiated between them and both futures positions are then terminated under the terms fo the EFP.