National interest: Who really owns the world? Meet Power Traders You’ve Never Heard Of | Economy

In our world today, traders of commodities of all kinds, such as food, medicine, fuel, metals, electronic products and others, play major roles through which they could monopolize a great deal of influence and power.

Two journalists – Jacques Farchi and Javier Blass – start from this idea to reveal in a book they have published under the title: “The World for Sale: Money, Power and the Traders Who Barter the Earth’s Resources” about what is behind the scenes in the commodity trading of dubious and often unethical methods.

and in book offer Published in February 2021, Carlos Roa, managing editor of the American magazine “The National Interest”, describes the thesis of journalists Farchi and Blass as honest, that those who trade in goods are not ordinary traders, but key players in today’s global economy is. , and thanks to their control In the flow of the world’s strategic resources, they became “strong political actors”.

unknown power

Despite the acquisition of enormous wealth and great influence, this trade remains a relatively unknown force for most people, so few of them – in the opinion of Carlos Roa in his article reviewing the book – know the history and stages of development, and adapting to changing markets and developments in technology, and methods of her work.

The two journalists reveal in their book the names of a number of traders who became extremely wealthy by buying and selling land resources. Interviewed by hundreds of current and retired commodity traders, Farshi and Blass delve into the corridors of commodity trading, describing them as “a world of daring traders and adventurers, African despots, Swiss bankers and ruthless business empire builders who may face the future of global geopolitics” their hands “.

The book “The World for Sale” deals with the final stages of World War II, which opened the door to an unprecedented boom in raw materials, “an era of peace accompanied by devastated cities and lands to be rebuilt. “

The authors tell how this unprecedented boom has helped companies operating in the field of commodity trading – such as: Glencore, Cargill, Vitol and Trafigura – to gain great wealth and political influence.

Striking personalities in the field

One of the leaders of this trade was Theodor Weiser, born in Hamburg, Germany, who traveled to the Soviet Union to get an agreement to export diesel and gasoline produced by the communist state to the West at the time.

And there is the American John H. Macmillan, the owner of Cargill, who is involved in the trade, purchase and distribution of grain.

Then there is Ludwig Jesselson, who fled from Nazi Germany to America after the pogrom against the Jews, and in New York he worked in the crockery before becoming the de facto founding father of a family that trades in goods, and owns companies – including Glencore – that exist to this day.

These three men are credited with creating business models and the corporate culture that has led commodity traders for over 80 years.

Wheat prices have risen as a result of the Russo-Ukrainian war, so bread prices in Egypt have risen by 50% (Al-Jazeera)

big theft grain

The managing editor of the National Interest says in his article that the book “The World for Sale” takes the reader on a quick tour in which he discusses the important events that accompanied the trade in commodities, such as the “Great Theft of Grain “- for example – for which the Americans accuse the Soviets of being responsible.

The Soviet Union suffered from poor harvests between 1971 and 1972 and sent the director of the grain trade agency, Nikolai Belousov, to the West, with the sole task of securing food supplies for the communist state.

There Belosov met John Macmillan, who had taken the helm of Cargill, and they negotiated an agreement to buy two million tons of grain. What Kargill did not know was that the Soviet envoy had previously met with the Continental Grain Company, a grain trading company, and concluded a deal to buy wheat and basic food worth $ 460 million, a record at the time. .

In total, Belousov was able to buy about 20 million tons of grain and oilseeds from traders.

Marcel Ryk

Among the characters dealt with in the book is a Jewish man who fled the Nazis to America, Marcel David Rich, who began his work as an employee at Philip Brothers for oil and natural gas products.

Rich took advantage of his presence in that company to find his way to fame, after starting himself working in the oil trade, and quietly managed to take advantage of the Eilat Ashkelon pipeline project, which was established to bring Iranian oil to To transport Israel to the June 1967 war, and Rich was able to sell Iranian crude oil to Europe.

By 1974, Rich and a number of other large traders had left the company to form Marc Rich + Co AG. Through the new company, he was able to save the Jamaican government from collapse by supplying it with about 300,000 barrels of oil within 24 hours in exchange for lucrative transactions.

Rich also supplied oil supplies to the racist South African government, bribing several officials in the Central African Republic of Burundi.

Events and stories

The second part of the book “The World for Sale” covers events that accompanied the collapse of Mark Rich’s empire around 2021, in addition to stories about Glencore in particular.

However, the background to which all these events revolve is perhaps the most interesting aspect of the story, and the most relevant to what is going on today.

The first of these events was the collapse of the Soviet Union, which Varchi and Blass describe as “the largest liquidation sale in history”, the repercussions of which are now being felt even more than ever.

According to the authors, it is the relations between Russian elite – and later the highest officials in the Moscow government – and commodity traders that keep Russia in business.

A relationship that continues despite the ban

In his article, Carlos Roa reveals that commodity traders continue to deal with the Kremlin and provide Moscow with an “invaluable economic lifeline”, despite the intensification of fighting in the current war between Russia and Ukraine.

According to the journalists, Flachy and Blass, the lessons learned from the transactions of commodity traders led to the rise of the rich Russian elite.

However, the other fundamental change that took place in the world order and shook the trade in goods was the rise of the People’s Republic of China.

China’s explosive growth, increasing cross-border capital flows, as well as rising demand for goods have contributed; Increase profits for companies like Cargill, Vitol and Glencore by more than $ 76 billion over the 2000s through 2011.

Obscene wealth and mistakes

Thanks to these huge increases, commodity traders have made enormous wealth, but these companies have stumbled along the way and continue to make those big profits as they have made many mistakes.

Among those mistakes: Glencore is accused in 2016 of plunging Chad into a sovereign debt crisis, due to a large loan the company provided to N’Djamena in exchange for crude oil.

Flashy and Blass point out that China has discovered the great potential in commodity trading and its huge return on profits, which spurred him to build his own capabilities in this area.

The two journalists cited the example of China Petroleum and Foodstuff Corporation, which has spent $ 4 billion since 2014 to establish a global arm for food commodity trading.

In the later parts of their book, the authors note that commodity traders are increasingly serving as a link between international financial markets, and channels for the transfer of dollars from pension funds and other investors to distant lands.

The National Interest article concludes that the sheer extent of power and influence means that if some commodity traders collapse, entire countries could collapse with them.

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