As a market leader in the global commodities industry with a turnover of $318.5 billion for the financial year 2022, Trafigura faces a formidable working-capital challenge.
The company requires a large amount of financing for the huge quantities of oil and petroleum products, non-ferrous concentrates and refined metals and bulk minerals it moves every year.
In October 2021, it announced the refinancing of its Asian syndicated revolving credit facility. This was followed in March 2022 by the refinancing of its European multi-currency syndicated revolving credit facilities and a return to the Japanese domestic syndicated bank loan market, as well as the syndication of a nine-month liquidity facility.
Laurent Christophe, group treasurer, explains that the company has access to $75 billion of lines, including about $10 billion in revolving credit facilities and $16 billion of corporate facilities.
“We have developed over the years a model to finance our working capital using trade finance, a very versatile tool that is effectively financing shipments in a secured way,” he says. “We also have long-term financing in place, such as revolving credit facilities and bonds.
"It is kind of a symbiotic model, whereby on a daily basis we have been financing shipments using trade finance, but also using the revolving credit facility to pay for the daily margin calls.”