Trade capacity is produced by a city and purchased by traders in that city to exchange goods with neighbouring cities.

A higher price of trade may help improve business practises in your city and thereby cause the more cultural-minded trading families to dominate. However, there are some vital benefits to having more-than-adequate trading capacity:

• A trader in your city may occasionally find a really good deal and need a lot of capacity for one year only (looking at a city's trade history can show you when this may have happened).
• More capacity may tempt traders from other cities.
• A city without trade capacity will greatly profit traders from other cities, thus giving those other cities faster culture gain.