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Commodity Finance Market Report 2018

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Niels de Ru



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Lang-Anderson Catherine
Catherine Lang-Anderson



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17 May 2018

As commodity prices begin to stabilise and the industry dusts itself off after the starkest regulatory recalibration and pricing downturn in many years, we find ourselves at a key inflection point in the timeline of the commodity finance industry.

​On the one hand, we have a growing global economy, new markets and renewed commodities emerging, partly enabled by revolutionary technologies and innovations being developed in boardrooms and lab rooms alike. On the other, growing political instability, still-stringent regulatory policy, and shifting consumer demands necessitate strict scrutiny in deal and decision-making.

This landscape has fostered the move towards new models for commodity traders with the larger ones concentrating on scale and consolidation strategies, whereas the small players are striving to eke out niches and digital developments to provide a nimbler offering.

The financing spectrum is more diverse with an increasing role for alternative lenders and innovative financing techniques, while a dexterous navigation of the legal and regulatory landscape remains a cornerstone of safe and successful deal-making.

How traders view these shifts and challenges is key to determining the direction in which the industry travels. While market practitioners continue to have their ear to the ground with a number of market intelligence sources, the response to the inaugural TXF-Allen & Overy Market Report, last year, demonstrated the desire for an independent, authoritative report on the condition of the commodity finance market as detailed by commodity traders.

For this reason, we have focused this year’s survey solely on traders, carrying out 60 in-depth interviews with senior professionals at commodity trading houses. We hope you find the information in here valuable and that it can form a complementary part of your strategy planning in the years to come.

To view our press release, “Allen & Overy launches Commodity Finance Market Report 2018 ”, please click here.

Hesham Zakai, Director, TXF
Niels de Ru, Partner, Allen & Overy

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