Timchenko doesnt need to be told to keep a low profile. That would put them well below the 16 percent stake Glencore CEO Ivan Glasenberg owns in his firm. We havent seen this pace of population growth in our living memory, Verghese told a conference in Singapore late last year. The company lists its trade in paper derivatives as larger still, or about 10 million barrels a day. In a settlement, Trafigura agreed to pay a $5 million fine, but wasnt charged with smuggling and denied wrongdoing. Thats the argument of Sunny Verghese, chief executive of Singapore-based trading firm Olam International. Global Advisors Newton said Dunand and Jaeggis ability to react to shifting markets means Mercuria will probably thrive in an unpredictable industry littered with failures. Two examples: it makes biodegradable and recyclable plastics out of corn at its $1 billion complex at Blair, Nebraska, and is creating new low-calorie food ingredients for such multinationals as Kraft, Nestle and Coca Cola. Revenues for the 10 largest investment-bank commodity businesses fell to $4.5 billion in 2013 from $14 billion in 2008, according to London-based analytics company Coalition. Since co-founding Mercuria with partner Marco Dunand in 2004, the company has ballooned into one of the top four commodity trading houses in the world, turning over more than $100 billion in. Independent traders including Mercuria are filling the void. Nigerias Petroleum Product Pricing Regulatory Agency (PPPRA) said that in one transaction the amount of fuel submitted for subsidies did not match the actual quantity delivered. The three former Goldman Sachs Group Inc. executives together own a controlling stake in Mercuria through a Guernsey entity called MDJ Oil Trading Ltd. A management shake-up this year at Frances most popular football club, Olympique Marseille, offers more proof of Margarita Louis-Dreyfus determination to defend her husbands legacy and impose hard financial choices. Enuit Hiring, Growing, and Focused on Next Version, Energy One Sees Early Success in 24 by 7 Services Market. Tornqvist says Gunvors goal is to become a truly global company. Co-founders Marco. He spent time trading metal in Hong Kong before moving to New York and a stint at commodities trading giant Phibro. Thats the setting where we learned the trade, Dunand said in an interview with Swiss newspaper Neue Zuercher Zeitung published in January. Cargill and Louis Dreyfus are the large missing players in the commodity trading space.. The French trading giant approached Olam with a merger proposal in 2010, but talks failed earlier this year. For Gunvors rivals, too, favoritism is also an overly simple explanation of the companys success. While pursuing Robert Louis-Dreyfus passion for the club, which drained millions from his fortune, she has placed strict conditions on new investment. Mercurias corporate strategy and culture have reflected the professional paths of its founders, who spent the bulk of their early careers at investment banks. It helps that Olam has backing in high places: Singapore state investor Temasek holds a 14 percent stake in the trading firm. Or this: publicity-shy Vitols sales of $195 billion in 2010 were twice those at Apple Inc. As well as the 200 tankers it has at sea, Vitol owns storage tanks on five continents. It is also the worlds second largest trader of rice after Louis Dreyfus. Cargill has since placed a moratorium on buying soybeans from newly deforested land. It helps that the firm usually has the backing of Washington. What matters is results, and you can see that in the way they trade.. Arcadias chief executive in Singapore, Stephen Gibbons, denied the contents of the cable and told Reuters the kidnapping allegations were ludicrous. Big trading firms now own a growing number of the mines that produce many of our commodities, the ships and pipelines that carry them, and the warehouses, silos and ports where they are stored. The incident was the subject of The Informant, filmed on site in Decatur. But it was absolutely one of the greatest moves in the business.. No suggestions of wrong-doing were leveled against Dunand or Jaeggi. Scale is going to be more important than ever.. Its a message that could apply just as well to the Louis Dreyfus group. Many small producers rely almost entirely on Koch to buy, sell and ship their crude. Koch declined to discuss its trading with Reuters. An array of storage tanks on five continents oils the wheels of its vast trading operation and it has stepped into the gap left by the oil majors as they reduce their downstream presence to focus on upstream exploration and production. In oil markets, Koch is a brutally efficient middleman. Last year he surprised the market when he trumped Chinas Bright Food in a $1.5 billion deal to buy Australias Sucrogen. It doesnt look likely anytime soon. But by the end of April, a U.S. Treasury directive authorized the Vitol transactions. Noble has grown by acquiring troubled competitors. From the 43rd floor of a Rotterdam skyscraper, staff members can look out over a network of rivers toward some of Europes biggest refineries. Owning businesses that produce, store, transport or process raw materials can provide an advantage in trading at a time when expanding populations have pushed global commodity demand to a record. Critics, including the Russian opposition, put it simply -- Russias paramount leader helped businessman Gennady Timchenko create the Gunvor oil trading empire, which saw a spectacular rise in the past decade when Putin was president and then prime minister. There has always been some concern about the trading firms influence, said Craig Pirrong, a finance professor and commodities specialist at the University of Houston, who points out that some firms have been associated with allegations of market manipulation. If youd like to retain your premium access and save 20%, you can opt to pay annually at the end of the trial. Put it this way: two of them, Vitol and Trafigura, sold a combined 8.1 million barrels a day of oil last year. That is as far as it goes -- yet time and again, the media wrongly jump to the conclusion that the judo club connection means that Mr Putin and I are close, then leap into conspiracy-theory mode.. Founded in the 1920s by patriarch Fred Koch, a U.S. engineer who developed a new method of converting oil into gasoline, Koch helped to build a refining network in the Soviet Union in the 1930s. The hires include Houston-based Shameek Konar, a former managing director with Goldman Sachs (GS) Group Inc. who is chief investment officer overseeing Mercurias corporate development, including the JPMorgan negotiations. Elman, the companys chairman, holds around 30 percent of the company. In 1937 the Chicago Board of Trade forced the company to sell its corn contracts and Secretary of Agriculture Henry Wallace accused it of trying to corner the U.S. corn market. 2022 welcome statement Marco Dunand, Mercuria's CEO, introduces the 2022 CSR report. In the two years since Margarita Louis-Dreyfus inherited control of the worlds top cotton and rice trader following the death of her husband Robert, the woman the French press call the tsarina has been at the center of one of the most intriguing struggles in corporate Europe. Founded in 1818 in Amsterdam, the company is the worlds No.1 oilseed processor. We dont hear much about them yet, but in time we will.. The report also details sales by a foreign Koch subsidiary of petrochemical equipment to Iran, which is subject to U.S. sanctions, and a history of criminal or civil penalties for oil spills, a deadly 1996 U.S. pipeline blast, and under-reporting of emissions of benzene, a carcinogen, from a Texas refinery in 1995. See here for a complete list of exchanges and delays. A wealthier world needs more food. ENERGY TURNOVER: $75 billion 2011 company estimate (2010, $47 billion). In 2006, J+S was raided by the Polish authorities in connection with an investigation into oil trading in Poland. The very public power struggle was all the more remarkable because the company normally keeps everything, from its precise earnings to the exact age of its main shareholder and chairwoman, a secret. And unlike commodities producers, such as U.S. oil giant Exxon Mobil, trading firms dont just make money when prices go up. The futures market may take some of that information and run with it. During your trial you will have complete digital access to FT.com with everything in both of our Standard Digital and Premium Digital packages. Argentinas tax office is investigating dozens of other agricultural exporters as well. A rare news release announced that Jan-Willem van der Velden, who started as an international trader at the company in 1997, would take over as CEO from January this year. It has trading offices in China, palm plantations and chemical plants across Asia, and silos in Brazil. For a full comparison of Standard and Premium Digital, click here. Lims biggest bet may have been an unprecedented 1997 spree in which Hin Leong bought 30 million barrels of jet fuel and diesel in the key Singapore market -- worth nearly US$800 million over a three-month span. I have known the citizen Timchenko for a very long time, since my work in St Petersburg, Putin told a group of Russian writers. Beyond Arcadia, Fredriksens stable of commodities-related firms includes MarineHarvest, a global salmon-farming conglomerate billed as the worlds largest seafood company. He also owns oil tanker operator Frontline, U.S. oil trader Parnon -- also named in the CFTC lawsuit -- energy driller Seadrill and gas distributor Golar LNG. Noble is now seeking to spin off its agriculture business with a listing on the Singapore Exchange. Trading houses were able to do this because international sanctions on Syria do not ban the sale of fuel into the country, but they did not have to fight off much competition for that business. WHO: Louis Dreyfus, founded 1851 by Leopold Louis-Dreyfus, WHERE: Paris WHAT: Cotton, rice, grains, orange juice. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the worlds biggest trading houses. It became the first company to supply gasoline to the energy ministry after the war in 2003, and now is both a buyer of Iraqi crude and supplier of refined products. Switzerland-based Glencore, whose initial public offering (IPO) in May put trading houses in the spotlight, pays some traders yearly bonuses in the tens of millions. You were always a little worried, taking the other side of their trades, said one European oil product trader, who declined to be identified. They stayed until 1994, then joined Phibro for a five-year stint when it was controlled by Salomon Brothers. Unsuccessful talks have taken place with Singaporean commodities group Olam International Ltd, while bankers say they have been sounded out about a stock market listing. Vitols wealth is spread across only 330 share-holding employees, fewer than Glencores 500. The Kochs have denied funding the Tea Party, but their empires far-reaching tentacles in the political arena have spawned a nickname: the Kochtopus. A few traders seized the chance to buy what amounted to almost all the available supply. Belgium-born Rich joined Philipp Brothers, subsequently Phibro, aged 20, leaving in 1974 with a fellow graduate of the Phibro mailroom, Pincus Pinky Green, to set up Marc Rich and Co AG in Switzerland. How big are the biggest trading houses? Still not entirely comfortable with his public profile, Glasenberg has described his shift into the glare of publicity as crossing the Rubicon. Hin Leong is joining hands with several Chinese firms to build the proposed Singapore refinery, even as it seeks to build a larger oil storage facility in the South Chinese province of Fujian. That strategy has often succeeded, though last month it found itself at the center of a dispute in the newly minted nation of South Sudan. Courts did not find any connection between its waste and sick people. It buys and sells multiple crops, mills and grinds and processes them into scores of products, both edible and not, and ships them to markets around the world. Change the plan you will roll onto at any time during your trial by visiting the Settings & Account section. On its website Koch said it dismissed several employees of a French subsidiary upon learning of the improper and unauthorized payments. It has also dipped a toe in the upstream business. Their friendship was galvanized a few years later working for grain trader Cargill Inc. and sharing an apartment while on a training course in Minneapolis. Like Rich, Dauphin created a leading commodities trading house by applying a knife-edge approach to business. One of the great things that Cargill did was develop the salt business to transport back up, eliminate the snow during the wintertime, and fill barges back up with back hauls, the wheat trader said. Just 10 years old, Mercurias ascent has outpaced its competitors. Shortly after the material was dumped, thousands of residents of the city of Abidjan complained of illnesses, including breathing problems, skin irritation and related ailments. Vitol says it is happy with its private status and has no IPO plans. Investors say he might already have his sights set on Brazil, to strengthen his position in the global sugar market. WHO: Hin Leong, founded 1963 supplying diesel to fishing boats. The award-winning provider of Commodity Management solutions worldwide. One of their secrets: filling the empty barges headed home. He is one of Russias most private tycoons. At its headquarters on Genevas poshest shopping street, traders and executives wear open-collared shirts, sweaters and jeans, a sharp contrast to the shirt-and-tie policies at more established firms. In 2011 the company will turn over $80 billion, up from just $5 billion in 2004. Perhaps to make up for that, it has moved into new sectors such as natural gas, coal and emissions. It now has stakes in a coal mine in Indonesia, oil and gas fields in Argentina, oil storage in China and a biodiesel plant in Germany. A master of physical markets, it owns a 4,000-mile U.S. pipeline network and three of the countrys most profitable refineries. The grains business accounts for a third of its earnings and could have a value of more than $5 billion. It is also the largest producer of consumer pack edible oils with about 45 percent market share. The new rules dont apply to trading firms. Trading houses saw the opportunity to leverage metals warehousing after the 2008 financial crisis. For us in the middle, we have the ability then to manage the commodity risk that can be created by the timing differences between those buys and sells, said Steve Mills, ADMs senior executive vice president for performance and growth. One of the things that gives us an advantage is that were working in the physical markets as well so (we can) absorb all that information and make the calls.. The companies dispute the charges. That experience defined the trading strategies of Dunand and Jaeggi who moved from Phibro to start Sempras European and Asian trading business in 1999 before founding Mercuria in 2004. (Additional reporting by Jean-Francois Rosnoblet), WHO: Bunge, founded 1818 by Johann Peter Gottlieb Bunge in Amsterdam. The JPMorgan unit employs about 600 and represents a range of assets assembled over decades by firms including Bear Stearns Cos. and RBS Sempra, which the bank bought during an acquisition binge beginning in 2008. People forget about it. [21], In January 2016, Mercuria announced that ChemChina had bought a 12% stake in the company. Roger Jones, the former head of commodities at Barclays Plc (BARC) who has spent more than a quarter-century trading, was hired in 2012 to head its non-oil business and join the board. In metals, stock in warehouses can be tied up for years as loan collateral, allowing the same traders who dominate the metals market to control a huge chunk of world supply -- an apparent conflict of interest that has drawn criticism from the UK parliament. Two decades ago, Chinese farmers fed their pigs just about anything they could lay their hands on. And its not just the Europeans. Trafigura said it entrusted the waste to a state-registered Ivorian company, Tommy, which dumped the material illegally at sites around Abidjan. Mercuria will dramatically reduce it, he said. They have the most talent, the deepest pockets, and the best risk management.. The payout percentage of profits at the commodities houses can be double what Wall Street banks pay, says George Stein of New York headhunting firm Commodity Talent. But there are people like David Bowie or Paul Weller who sense that the market is moving and change with it. With around $100 billion in sales, Koch Industries is a heavyweight among U.S. oil trading firms, and one of the most secretive U.S. corporations. We know how to close the gap (with Vitol and Glencore) and we are actively catching up, Tornqvist said. Like Vitol, he says, Gunvor has no plans to follow Glencore into an IPO. They go where the business is, said an industry insider who asked not to be named. Lims Chinese connections have played a big part in the companys success. Like rival Vitol, Trafigura has seized the opportunity to get into oil storage as oil majors focus on production. Mercuria Energy Group Ltd is a Cypriot-domiciled French[1] multinational commodity trading company active in a wide spectrum of global energy markets including crude oil and refined petroleum products, natural gas (including LNG), power, biodiesel, base metals[2] and agricultural products. Asked to comment, Cargill said the company actively backs free trade to boost agriculture in all countries and is in dialogue with many important audiences, including governments Additionally, we dont believe export bans are the solution to either high grain prices or price volatility. ADM declined to comment and a spokesman for Bunge could not be reached. That comment didnt help calm rumors and then Timchenko spoke too. Dunand said in January the sale of an equity stake could raise $500 million to $1 billion. They have some superstars but mostly a lot of team players -- what I would describe as well grounded, fundamental traders.. That complements his plan to set up a 200,000 hectares plantation in Indonesias Papua island, which could make him the new Asian sugar king, a title once hold by his uncle. In some cases it makes up 60-80 percent of what they do, said Carl Holland, a former price risk manager at oil major Chevron Texaco, who now runs energy consultancy Trading Solutions LLC in Connecticut. They were early dealers in a range of financial derivatives that are now commonplace and brought a level of sophistication to their trading books that most of their competitors could often only envy. Thats still a lot less than the billions the biggest independent oil traders make and a long way off the revenue of Marquard & Bahls oil tanking division, the second largest in the world after Vopak. But ADMs reputation has endured a black eye or two over the years. A small Minnesota linseed crushing business more than a century ago, the firm is now is so big its financial performance is often viewed as a barometer of agribusiness as a whole. Verghese, who Forbes says is worth $190 million, believes he can go it alone and aims to quadruple the companys value by 2015. Cognite Data Fusion Deployed for Data Management in Oil & Gas and Power. It bought UK-based metals warehouser and logistics firm NEMS in March 2010, a month after Goldman Sachs had acquired rival Metro and several months before Glencore and JP Morgan moved into the business. It has coal mines in Kalimantan in Indonesia, oilfields in Argentina and Canada plus oil trading in Singapore, Chicago, Houston and across Europe. Now Dunand, 52, and Jaeggi, 53, are executing a plan to propel Geneva-based Mercuria Energy Group Ltd. nearer to the top independent traders, Glencore Xstrata Plc (GLEN), Trafigura Beheer BV and Vitol Group. Marco Dunand and Daniel Jaeggi, both Swiss, have worked together closely for more than 25 years in a string of commodities companies, buying and selling crude and oil products in many of the hottest oil trading outfits: Cargill, Goldman Sachs J.Aron, Salomon Brothers Phibro and Sempra. Thanks to a market condition known as contango -- a period when buyers pay more for future delivery than to receive their cargoes promptly -- they could sell futures and lock in profits of $10 a barrel or more. J+S denied any wrong-doing and suggested the investigation was politically motivated. With a personal fortune estimated by Forbes at $10.7 billion, the 67-year-old was Norways richest man until he abandoned his citizenship in 2006 to become a national of Cyprus, where tax rates are lower. They have grown at a very fast pace in the oil markets, and now they are expanding into other commodities.. We are not thinking about an IPO -- but that doesnt mean we dont have an open mind, Dunand told Reuters in June. See Marco Dunand's compensation, career history, education, & memberships. Vitol was founded in 1966; Glencore in 1974; Trafigura started in 1993; and Gunvor, the fifth-largest independent trader controlled by billionaires Torbjorn Tornqvist and Gennady Timchenko, was founded in 2000. Any changes made can be done at any time and will become effective at the end of the trial period, allowing you to retain full access for 4 weeks, even if you downgrade or cancel. Glencore has long made its fortune by working on the fringes and in areas where few others dared. 03.10.2014. Dunand and Jaeggi are Mercurias largest shareholders but an employee share ownership scheme holds around 40 percent of the company. Finding itself with a big client base, but short of the physical supplies it needed to meet demand, Noble built its own processing facilities. Their move to run their own empire came in 2004 when they founded Mercuria, raising capital from two Polish businessmen, Grzegorz Jankielewicz and Slawomir Smolokowski. A deal with JPMorgan would further challenge Dunand and Jaeggi, who each own 15 percent of Mercurias equity, to integrate the operations into a company that is already growing rapidly. In 2014, Mercuria bought part of JPMorgan's physical commodities trading business for a reported US$3.5 billion. Dunand and Jaeggi first met studying economics at the University of Geneva in the late 1970s. News carefully selected news stories from around the industry. The trading houses talent and deep pockets translate into incredible power. WHO: Trafigura, founded 1993 by former Marc Rich traders Claude Dauphin, Eric de Turkheim and Graham Sharp. In early 2007, when world grain prices were surging toward all-time highs, it faced a problem in Ukraine. If you have any issue with this post please contact us, News > Commodity Trading > Behind the $100 Billion Commodity Empire That Few Know, CTRM Center But most analysts think it needs fresh capital to grow, or to buy out minority family shareholders who will have the option to sell their stakes in 2012. But since White Plains, New York-based Bunge set up in China in 1998, many have switched to soy pellets. Or this: Glencore in 2010 controlled 55 percent of the worlds traded zinc market, and 36 percent of that for copper. When out-of-town employees visit, he has taken them to dinner at seafood chain Red Lobster, a former Koch employee said. Headquartered in Geneva, Switzerland, and named after Mercury, the god of merchants, Mercurias business straddles global energy markets. You can still enjoy your subscription until the end of your current billing period. Work Permit Application Outcome. tracking emerging trends and opportunities in the future of energy. Mercuria CEO Marco Dunand, President Daniel Jaeggi and global head of trading Magid Shenouda are the firm's biggest shareholders. Premium access for businesses and educational institutions. There is no rush, the company has been private for 150 years so there is no specific timing for changing the shareholding structure, one source close to the company said. Mercuria's Marco Dunand talked to S&P Global Platts about the challenges, implications, and opportunities that the coronavirus pandemic presents across all the key commodity classes in a time of unprecedented volatility in the global markets.
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