TXF APAC Trade & Commodity Finance 2021
Join us while we are looking into the commodity finance sector for the Asia Pacific region. Connect with key players and hear about current and future deals.
Commodity finance comprises two key products. The first is commodity-linked loans in the agriculture, oil and gas and mining industries where the lender has the future production or reserves of the commodity as security. These types of deal can be reserves-based loans, pre-export facilities, prepayment facilities, or even streaming, royalty-based loans and factoring. The second are very large unsecured term loan and revolving credit facilities provided annually by commercial banks to the major commodity trading houses and producers – Glencore, Gunvor, Trafigura, Vitol, ADM, Bunge and Castleton for example. These loans, effectively working capital facilities, also enable the major traders to provide loans to commodity producers that lack liquidity, thus ensuring security of commodity supplies and additional profits from that lending due to the arbitrage between the cost of debt for the major traders and what they can on-lend at.
TXF spoke with Tor Mosegaard, head of European power trading at Danske Commodities, to discuss the Danish energy trading house’s role in accelerating the energy transition, having last year signed a 15-year PPA to offtake electricity from the world's largest offshore wind farm - Dogger Bank A and B in the UK.