Commodity trading gross profit hits record $115 billion in 2022

Commodity trading companies generated a record $115 billion in gross profit last year, up 60%. This was a consequence of the extraordinary volatility in commodity prices associated with the fighting in Ukraine, primarily energy. Such data, as reported Financial Timesare contained in a study by the consulting company Oliver Wyman.

“From the point of view of traders, the past year has been a kind of perfect storm for all commodities, and volatility is the source of life-giving force for traders that they need in order to actually trade,” the newspaper quotes Ernst Frankl, one of the authors of the report and firm partner.

Large independent traders such as Trafigura, Vitol and Glencore have benefited the most from the market situation. So, the Anglo-Swiss trader Glencore reported last year a net profit of $17.3 billion, that is, a tripling of this figure compared to 2021. In turn, Trafigura’s net profit for the fiscal year ending in September 2022 amounted to $7 billion. This is more than the company’s total net profit for the previous four years. Financial players such as hedge funds also made the most of the situation. On trading operations they earned about $12 billion against less than $3 billion the previous year.

According to Oliver Wyman, the events in Ukraine were not the only reason for such a significant increase in income. According to another partner of the company, Adam Perkins, the growth in demand for commodities, which was the result of the growth of the global economy and the recovery of economic activity, also played a role.

Andrey Kelekeyev