TRADING FORUM :
The 9th Edition of the Trading Forum
Commodity Trading : Market Evolution
in response to Technology Evolution
was held on Tuesday 21 March 2017
At Fédération des Entreprises Romandes, 98, rue de Saint-Jean, 1201 Genève
Thank you to all the leading experts who feeded great exchanges at 9th Edition of Commodity Trading Forum !
The 9th Edition of the Trading Forum, Innovation and business ethics: the commodity trading sector and the challenge of technological evolution, that took place on Tuesday 21 March 2017 in Geneva, brought together experts form the world of commodities and beyond to address the issue of technological evolution and what it holds for commodity markets.
The issue if of great importance for the Swiss hub. As State Councillor Pierre Maudet reminded the audience, the sector alone contributed 22% to the Canton's finances.
With each speaker adopting a different angle, the event covered a broad array of commodity classes.
Gennadiy Shulga from SGS highlighted how innovation is playing a crucial role in meeting the food security imperative for an increasing world population gradually adopting calorie-rich diets. Precision imagery, soil biology, weather data mining and better analytical modelling are all helping bridge the gap.
Blockchain and distributed ledger technology (DLT) were amongst the most discussed topics, as the technology holds a lot of promise, ushering in the age of the paperless transaction, while dramatically shortening the transaction cycle. The initiatives of commodity trade finance banks such as BNP Paribas and Société Générale in this area, together with trading houses established in Geneva such as Sucafina and Mercuria, were presented. At this stage the approach focuses on developing MVPs (minimum viable products) but the pace of innovation is relentless.
One of the strengths of DLT is that it provides for secure transactions, a must according to Erik Bay Gundersen of Mercuria who cited Geneva-based Trade Cloud as an example of innovation in the sector. He nevertheless stressed the importance for physical trading firms of building long-term relationships and of "face factor".
But the rise of technology does not mean an end to the impact of geopolitics on trading. David Fyfe of Gunvor explained how developments in countries such as Saudi Arabia, Nigeria and Libya were key to understanding oil market dynamics, besides the implications of the OPEC agreement.
Following a thought stimulating keynote from Dr. Thomas Philbeck of the WEF, discussions on innovation highlighted that Switzerland hosts a complete ecosystem and that innovation is already taking hold.
Business ethics were also extensively discussed, with a keynote from Prof. Christine Kaufman of the University of Zurich. While companies have to find their own guiding North star, innovation such as blockchain can help immensely with meeting due diligence requirements as it enables the capture of vast amounts of data along value chains.
The issue of human rights is becoming more material for trading companies, as the UN's Guiding Principles on Business and Human Rights (Ruggie principles) start to be implemented in a growing number of countries and National Contact Points open more proceedings, a trend visible in particular in the Netherlands and Canada.
Yann Kermode of UBS underlined the change brought by the Ruggie principles by bringing stakeholders around the table and overcome ideological barriers. However, these principles need to be translated for each industry.
For commodity trading the biggest challenge when translating the Ruggie principles for their implementation within the sector is its diversity, as stated by Sandra Landenmann of the Federal Department of Foreign Affairs. She also encouraged the industry to focus on voluntary action, as does the Swiss National Action Plan, leaving room only for mandatory rules where voluntary actions do not work. But implementaing UNGPs should not only focus on sticks but also think in terms of carrots according to Ramon Esteve of Ecom, who gave the example of development banks that require the companies they fund to be compliant with UNGPs.
The final session of the Trading forum was devoted to a presentation by Anna Klinert, a former student of the STSA/Univeristy of Geneva Master in Trading, on the impact of Egypt's wheat policy on the international and national markets. It was followed by an interactive Q&A session moderated by Prof. Marco Olarreaga, the new Dean of the GSEM.
All in all this 9th edition was an unmitigated success and helped position the Swiss trading industry to better embrace the rising tide of innovation and transform it into opportunities.
Thank you to our sponsors :
What was in the program
Commodity Trading :
Market Evolution in response to Technology Evolution
Presentation Video :
In partnership with :