What does it mean that the futures contracts are in contango?

What does it mean that the futures contracts are in contango?
The simple answer: When the the futures contract price is higher than the expected spot price when the contract becomes due, or during the lifetime of the contract. When the contract becomes due, the price should be exactly or very close to the spot price (the price of the commodity right now) on the day that it is due. But more often than not, this is not the case. So there would be a decline in prices as the contract approaching the last trading day (or even last minutes of trading that day) as the 'future price' is then matched to meet the spot price.

Non-perishable commodities such as oil or gold are typically contango, as it would cost money to insure, store, etc the underlying commodity. This would make the 'future' price of a contract 12 months from now greater than the spot price to buy the same barrel of oil today. Remember, one of the objectives of futures contracts is for suppliers to lock in a price to guarantee that they will have xx barrels of oil, gold, etc in the future at $yy.yy sales price today.

Contango is just an adjective that describes the actual phenomena of the futures price falling to line up with the spot price as the contract approaches maturity.

The opposite of contango is backwardation.