Quote from Rostand Heritier on June 10, 2024, 9:19 pm

Ever heard someone talk about making billions while they can barely afford lunch? They claim to be trading big commodities like coal, natural gas, copper, sugar, and corn. They’re always on their phones, copying and pasting messages, making calls, and acting like they’re closing massive deals. But let’s be real—commodities trading is more than just big talk. It’s about low profit margins and high turnover rates. So, if you know someone like this, it’s best to steer clear.

The Wannabe Billionaires

You know the type. These folks might not have much going on financially, but they love to brag about billion-dollar deals. They focus on commodities like coal and copper, using their phones to create an illusion of having loads of cash. They copy, paste, call, and pretend to be wealthy, hoping to lure sellers into believing they’ve got money. This kind of “fake it till you make it” strategy doesn’t work in real commodities trading, which relies on small profits and fast transactions.

The Myth of Quick Riches

Let’s break down why this “empty-handed wolf-catching” strategy is a pipe dream. These folks think that by showing off large amounts of money in their accounts (which they often don’t actually have), they can convince sellers to deliver goods. But here’s the kicker—nobody in the real world of commodities trading falls for this. Real traders build their businesses on trust and transparency. They earn money through careful operations, not by pretending to be rich. The idea of making huge profits through middleman fees or overnight success is just a fantasy.

The Real Path to Success in Commodities Trading

So, how do you actually make it in commodities trading? Let’s look at two genuine models:

1. The Private Entrepreneur Model:

- These are the folks who’ve spent years building solid supply chains, especially in industries like coal. They know their business inside out.

- Typically, a private entrepreneur might handle 20,000 tons of coal a month. But by partnering up in what’s called a “tray business” (think of it as a financing partnership), they can boost that number to 50,000 tons or more.

- This model works because it’s a win-win. The entrepreneur scales up, the partner makes money, and everyone benefits. The risk is lower because the entrepreneur already has a proven system.

2. The National Team + Big Company Model:

- Big state-owned enterprises and major corporations have plenty of money but sometimes struggle to find enough supplies.

- They look for partners to help source materials globally. To make sure everyone’s serious, the partner has to put up at least 20% of the total investment.

- This shared investment means everyone’s got skin in the game. It ensures the partners are committed and willing to take on some of the risk.

The Key to Winning: Collaboration and Risk Management

Every commodities trading project comes with its own set of costs and risks. To succeed, you need a high level of resource and financial alignment. You can’t just jump in blindly; projects need careful vetting and risk control. Only then can you consider taking part.

In the end, the message is clear: commodities trading isn’t a shortcut to getting rich quick. It’s about consistent operations, trust, and strategic partnerships. The fantasy of making millions overnight by pretending to be rich is just that—a fantasy. True success comes from sustainable practices and effective risk management. When private entrepreneurs and big companies work together, understanding the market and sharing the risks, they can achieve real growth and profitability in the world of commodities trading.

So, if you spot someone who’s all talk and no substance, boasting about billion-dollar deals without the means to back it up, give them a wide berth. Stick with those who understand that real success comes from hard work, reliability, and smart partnerships. That’s the true path to making it big in the commodities world.