Glencore made a speculative bet on rising wheat and corn prices in the early stages of last summer’s Russian drought, the world’s largest commodity trader has revealed ahead of its initial public offering that will value the company at $60bn.
As it bet on rising prices, senior traders at the Swiss-based company publicly urged Russia to impose a grain export ban. Moscow acted a few days later, triggering a grain rally. Glencore is the largest trader in Russian wheat, followed by US-based rivals Cargill and Bunge.
The issue is sensitive because politicians such as Nicolas Sarkozy, French president have often blamed speculators for rising food prices. The G20 group of leading economies will hold a special meeting in June to discuss grain markets.