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What do commodity trading firms do

What do commodity trading firms do

A commodity trader is an individual or business that focuses on investing in physical substances like oil, gold, or agricultural products. The day-to-day buying and selling are often driven by expected economic trends or arbitrage opportunities in the commodities markets. Who are commodity traders and what do they do? Commodity trading firms play a pivotal role in the global supply chain by bridging gaps between producers and consumers, and balancing supply and demand both within regional markets and at a global level. Ancient civilizations traded a wide array of commodities, from seashells to spices. Commodity trading was an essential business. The might of empires can be viewed as somewhat proportionate to their ability to create and manage complex trading systems and facilitate commodity exchange, How do trading companies make money? In short, they buy, stock, transport, process and sell commodities from a place of surplus to a place of deficits. The big trading players such as Vitol, Cargill, Trafigura, Olam, Mercuria, Louis Dreyfus, Glencore, etc… always pivot their business model around those activities. The company engages in the extraction, trade, refining, storage, and transport of energy. Vitol Asia Pte Ltd is headquartered in Singapore. Glencore has worldwide activities in the production, sourcing, processing, refining, transporting, storage, financing and supply of metals and minerals, energy products and agricultural products.

The Economics of Commodity Trading - A great resource developed by Dr. Pirrong of the University of Houston for Trafigura.

9 Sep 2015 Historically, Commodity trading companies (CTCs) focused mainly on trading firms often rely on Commodity and Energy Trading and Risk  13 Nov 2012 Commodity trading focuses on purchasing and trading commodities like gold rather than company shares as in stock trading. Like stocks,  14 Nov 2019 The commodity market is a great platform for speculating on a diverse and exciting range of global assets. In this guide to commodity trading 

2 Apr 2019 So, what's a commodity trading firm to do? Under the new framework, firms will fall into one of three categories for prudential capital calculation 

Capco is one of only 11 partner firms in North America that are renowned experts in the use of Allegro®'s commodity trading and risk management software. 3 Sep 2018 Noble Group's collapse from a $6 billion commodity trading firm. 3 Min Read. ( Reuters) - Troubled Noble Group was saved from insolvency  This makes Switzerland the largest trading centre for such commodities, while Swiss-based firms are said to control between 15 to 25 per cent of the global 

17 Jan 2018 As you know, a lot of the work done by commodity trading firms is done by third- party contractors. If we establish standards, it therefore follows 

March 2014 - Commodity trading is one of the oldest forms of human activity. It is central to the global economy. Yet up to now there has been remarkably little research into this important area. The Economics of Commodity Trading Firms demystifies the commodity trading business through a combination of description and analysis. • Commodity trading firms are all essentially in the business of transforming commodities in space (logistics), in time (storage), and in form (processing). Their basic function is to perform physical “arbitrages” which enhance value through these various transformations. Commodity traders come in all shapes and sizes, but commodity trading firms can be and often are juggernauts. In the last year alone, the top 10 global commodity trading firms brought in $1.3 trillion in revenues. According to the Financial Times, a report commissioned by the Global Financial Markets Association,

However, unlike terminals, commodity trading firms do not need to own their own vessels. Ships are interchangeable and port facilities are not. They may charter 

13 Feb 2019 Yet when the world's biggest commodity trading houses have gone out looking for equity investors, they've found few takers. From energy giant  17 Jan 2018 As you know, a lot of the work done by commodity trading firms is done by third- party contractors. If we establish standards, it therefore follows  28 Jun 2019 Washington, DC – The Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against  16 Apr 2013 New EU financial market rules on the financial industry are likely to impact commodity trading companies. One of the most relevant is MiFID II.

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