Tracking the trends 2010 considers whether demand from growing nations is sustainable, assesses the impact of ongoing commodity price volatility and stresses the importance of effective demand management.
Commodity trading and mining
We are a leading service provider to commodity trading and mining companies in Switzerland. Our expertise covers local and international aspects of the commodity trading and mining sector for our internationally orientated clients. Our global, integrated approach combines insight with business and industry knowledge to help our clients excel anywhere in the world. Whether your extractive operations are located in traditional resources-rich centres like South Africa, Australia or South America — or in more far-flung locations like Kazakhstan or Angola – and your trading operation is here in Switzerland, we have local experts on the ground who understand the landscape and can help you come out on top.
Our experts in Switzerland have experience in the trading business and its value chain components – starting with paper and physical trade origination, position valuation and trade settlement, deal flow, internal controls, risk mitigation strategies, trade finance and shipping and freight.
Our expertise in commodities is focused on:
- agricultural (grains)
- energy (crude oil, gas, coal)
- industrial metals: base metals, ferrous and non-ferrous metals, alloys and rare metals
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Research and insights
Issues and trends within the industry
- The commodity sector is no stranger to boom and bust cycles. However, the current economic downturn has seen commodity prices significantly decline, leaving many companies saddled with unsustainable production costs and high capital commitments.
- The speed of the commodity price fall has led to many commodity companies announcing production halts and deferring investment decisions. Cost management has been pushed to the top of the corporate agenda – in a bid to offset falling commodity prices and respond to ongoing high costs for development, materials and labour.
- Despite the impact of the economic downturn, the underlying industry fundamentals remain strong. As demand has fallen, stocks have increased causing commodity prices to tumble. In the short-term, demand has increased as entities take advantage of the low prices stockpile which has caused an increase in commodity prices.
- In the long-term, demand will recover. The need for infrastructure and desire for urbanisation has not gone away..The market remains cautious.
- Natural resource companies also have to contend with the rising costs of regulatory compliance and sustainable development. And, whilst many companies pursue global diversification to resolve some of these challenges, both political and regulatory instability in many nations has raised the stakes of expansion.
Our clients
Deloitte Switzerland is one of the leading audit and advisory firms to the commodity trading and mining sector and works with a number of large trading companies in Switzerland.