Commodity traders need new model as transparent market cuts margins

Singapore

FOR commodity traders operating in the Information Age, just good old trading doesn't cut it anymore.

Unlike the stock market in which transactions are typically based on information that's public, firms that buy and sell raw materials thrived for decades in an opaque world where their metier relied on knowledge privy only to a few.

Now, technological development, expanding sources of data, more sophisticated producers and consumers as well as transparency surrounding deals are eroding their advantage.

"Everything is transparent, everybody knows everything and has access to information,"…