Meet The Mysterious Trading Firms Who Control The Price Of Commodities

oil well shadow

Welcome to the real world of commodities trading. Home to firms like Vitol and Trafigura, who trade more oil than Saudi Arabia and Venezuela can produce.

In a new report, 18 Reuters’ reporters and editors profiled 16 giant commodity companies that often go unnoticed. Combined, they generate annual revenue of $1.1 trillion.  The top five pull in $629 billion, rivaling the five largest financial institutions on the planet.

What they learned: They’re massively profitable. They disrupt markets. Government’s have little ability to police them. And they have ambitious plans to grow.

#16: Hin Leong (Singapore)

Revenue: $8 billion (2010)

Trading Markets: Oil, oil tankers

Founder and CEO Lim Oon Kuin got his start by transporting diesel by bicycle. The company is now planning to build Singapore's fourth oil refinery in a move that would bring it closer to complete vertical integration: it already owns the tankers that ship oil.

Source: Reuters

#15: Olam (Singapore)

Revenue: $11 billion (2009/10)

Trading Markets: Coffee, cocoa, rice, sugar

Olam started as a company that traded Nigerian cashew nuts. It has since become the world's second largest rice trader, and now owns plantations and mills across the world. The company employs more than 13,000 people.

Source: Reuters

#14: Mabanaft (Rotterdam, The Netherlands)

Revenue: $15 billion (Reuters Estimate)

Trading Markets: Oil

With a staff of 1,700, Mabanaft sold more than 20 million tons of oil last year. The company is expanding into naphtha, liquefied petrol and wood pellets.

Source: Reuters

#13: Arcadia (London, England)

Revenue: $29 billion (Reuters Estimate)

Trading Markets: Oil

The company trades more than 800,000 barrels of oil a day and puts on derivatives for more than 10 million barrels a day. Arcadia has close relationships with Nigerian and Yemeni state oil firms, where it has reportedly broken laws to buy oil at below market prices.

Source: Reuters

#12: Wilmar International (Singapore)

Revenue: $30 billion (2010)

Trading Markets: Grains, sugar, oils

Wilmar is the largest soy processor in China, controlling nearly 20% of the market. The company owns plantations, mills, processing facilities and transport for distribution.

Source: Reuters

#11: Bunge (White Plains, New York)

Revenue: $46 billion (2010)

Trading Markets: Sugar, grains, feeds

Bunge is the world's largest oilseed processor. It's also one of the largest feed providers in China, helping bulk up the nation's livestock. The company is aggressively expanding in South America.

Source: Reuters

#10: Louis Dreyfus (Paris, France)

Revenue: $46 billion (2010)

Trading Markets: Cotton, rice, orange juice

The 160-year-old company is the largest trader of cotton and rice, but is struggling to grow. The company needs fresh capital and could become publicly listed in 2012.

Source: Reuters

#9: Noble Group (Hong Kong)

Revenue: $57 billion (2010)

Trading Markets: Sugar, coal, oil

Founder Richard Elman is a high school dropout who got his start commodities in the scrap metal business when he was 15. He was also once a trader for Phibro. He now runs a company that employs more than 11,000 people. Noble has deep connections with politicians in China, where it plans to expand aggressively.

Source: Reuters

#8: Mercuria (Geneva, Switzerland)

Revenue: $75 billion (2011)

Trading Markets: Energy

The company employs 890 people and trades nearly 120 million tons of energy commodities a year. Mercuria owns coal mines and oil fields across Asia, Europe and North America.

Source: Reuters

#7: Trafigura (Geneva, Switzerland)

Revenue: $79 billion (2010)

Trading Markets: Metals, energy

Trafigura ranks third in oil trading and second in industrial metals, all the more impressive considering the company is less than 20 years old. It paid a $200 million fine after dumping waste along the Ivory Coast that reportedly killed 16.

Source: Reuters

#6: Gunvor (Geneva, Switzerland)

Revenue: $80 billion (2011)

Trading Markets: Energy, emissions

Gunvor has gone from a company with $5 billion in revenue in 2004 to an expected $80 billion this year. The company has expanded into coal and natural gas to buttress its oil dominance, which accounts for 20% of Russian exports. Co-founder Tornbjorn Tornqvist attributes the company's success to having 'excellent contacts.'

Source: Reuters

#5: ADM (Decatur, Illinois)

Revenue: $81 billion (2010)

Trading Markets: Corn, cocoa

The company owns barges, trucks, railways and even the processing plants that make the goods it ships. The movie The Informant! was based on ADM's lysine price-fixing scandal, which resulted in a 2003 fine of $100 million.

Source: Reuters

#4: Koch Industries (Wichita, Kansas)

Revenue: $100 billion (2010)

Trading Markets: Oil

Koch Industries, led by the Koch brothers Charles and David, owns three of the nation's most profitable refineries and operates in 60 other countries. They've also been credited with bank rolling the Tea Party movement. Charles Koch's net worth is estimated to be $22 billion.

Source: Reuters

#3: Cargill (Minneapolis, Minnesota)

Revenue: $108 billion (2010)

Trading Markets: Grains, salt, fertiliser, metals, energy

Cargill pioneered the concept of filling up empty barges on their return trips -- a revolutionary idea when first implemented. For example, grain would get shipped down river, and then salt would get shipped up. If it were public, Cargill would rank 13 in the Fortune 500, right behind Citigroup.

Source: Reuters

#2: Glencore (Baar, Switzerland)

Revenue: $145 billion (2010)

Trading Markets: Metals, minerals, agricultural

Glencore went public last year, opening up one of the most venerable trading businesses to public view. Last year the company controlled more than half of the zinc market, and than a third of the copper market. CEO Ivan Glasenberg made $10 billion on the IPO.

Source: Reuters

#1: Vitol (Geneva, Switzerland and Rotterdam, The Netherlands)

Revenue: $195 billion (2010)

Trading Markets: Oil, coal, metals, sugar

This oil giant trades more than 5.5 million barrels a day and has storage tanks on five continents. Vitol was the first company to trade with Libya's rebels, against Gaddafi orders, supplying them with more than $1 billion in fuel.

Source: Reuters

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