Commodity Trading’s $120bn Cash Reserves After Years Of Record Profits

After experiencing five years of unprecedented growth, the commodity trading sector has amassed a staggering $120 billion in cash reserves, setting the stage for major players to bolster their dominance through reinvestment.

According to a study conducted by global management consultancy Oliver Wyman, these reserves, estimated to range between $70 billion and $120 billion, reflect a significant surge in profits across virtually all segments of the industry.

Independent traders have been particularly successful, with “five years, back to back, of the best year ever”, said Adam Perkins, Partner and one of the report’s authors. “As a consequence of that, people are just sitting on absolutely enormous piles of retained earnings and the question that people are asking themselves is what can we do with that?”

Read the full article in the Financial Times and Bloomberg. (paywall)