can someone give me insight on the culture at a physical trading house (vitol, trafigura, mercuria)
what’s the culture like? What are the hours? How often do you have to travel as a physical/ commodity trader? How much paid leave do you get? if anyone from the industry or anyone at these firms could answer these questions.. it would be greatly appreciated
Seems like half the S&T threads these days are on physical trading. Not complaining, but interesting.
probably because it is super lucrative and doesn’t seem like it will ever be automated. Plus there will always be a strong world wide demand at all time, whether it’s liquified natural gas or crude oil
I'm an incoming at one of the firms you mentioned and I'm not sure "super lucrative" is how I'd describe my salary/expected salary progression (or trading firms in general for that matter). I do agree that the industry is probably more resilient than its WS counterparts, and hope that trading firms will continue to be adaptable (my perception is that this is something hardcoded into their DNA by nature of what they do). But even if work doesn't get automated/disappear, seats are very limited to begin with. An entire global team of a commodity for example might only have 20-30 dedicated employees across multiple functions. Doesn't mean I'm not excited about the career path though.
If you have been on a news fast for the last 3 months, now would be a good time to break it.
facts
Can speak to this, work the industry.
Pay for jr traders $100,000. Standard I know of is about $2/300k range, though I know heads running books making a couple mil all in.
Often take home some of their book. Hours are generally 7:30/8 - 6:30, occasionally after 8. Of course this is in office, I know a lot of calls are made from home given physical is more logistical. Travel can be huge, once a month is probably the least you’ll do, often to the ‘source’ (refinery or smelter is common).
interesting industry for sure, just know that you won’t trade for 5+ years in most shops - you run MO/BO roles with fancy job descriptions but awful roles.
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Co-sign all the above. Although I would say a majority of travel is to customers since they tend to be less concentrated than the producer side.
Is the main point of travel the face to face aspect of relationship building, or is there a point to it on a technical level--say examining their operations/warehouse so you can better serve them? If it's mostly the former, will travel be similarly expected to reduce after COVID as in other industries?
Timeline is 100 percent not true. Very possible to land a junior role as an entry level role, just need to be the right candidate!
Would be keen to hear where. Happy to stand corrected but speaking from experience in the major phys houses (Glen/Traf/Merc/Gunv), I have never seen someone come in straight from university into a physical trading role (or paper for that matter). I've heard of junior merchandising at a couple of the grain shops at best.
Regarding your paid leave question, depends on what country/region you are working in. The Swiss guys will get more leave than the US ones. Doesn't mean they use it all.
Of the three firms listed, what is the general outlook on each of them? In terns of pay, culture, and upward mobility?
The odds of having an offer at one of them, let alone a couple or all three are so slim this is kind of irrelevant.
That said Trafi has a bad rep culture-wise vs the other two. Mercuria's founders have a Cargill/Goldman background which is very different from your Glencore and Trafiguras of the world. Vitol is kind of its own animal, about as pure-play trader as they come and the comp numbers you hear are massive. Had an in with them years ago but I unfortunately did not have experience in commodities back then.
When you say that Mercuria is different to Glencore/Vitol because of the Cargill/GS background of the founders (I assume also because of the JPM acquisition?), do you mean in terms of the general workplace culture or is it the investment approach you’re referring to? How is it different? Thank you.
Big thing to note for you is mobility - common to be doing a scheduling role for a significant period (think 4+ years).
Can’t speak to culture as haven’t moved shops, but know that this is VERY different than s&t trading floors.
To OP: the answers to your questions might also be very different depending on the role/geography you're talking about.
I can only speak to the culture at Vitol but I knew a guy that was in the finance group and finally landed a job in operations. He did that for a few months and then messed up some scheduling on a pipeline and got fired the second his boss found out about it. Very cut throat culture but as GoodBread said - the pay is some of, if not the, highest out there.
I have gone through the interview process with Trafi two times now and they haven't come across as a place I would want to work either time. After talking to friends in the industry the hunch seems to have been confirmed. If you pride yourself on how many hours you can put in and how autistic you can be about your dedication to your work while ignoring all other aspects of your life then maybe it isn't that bad.
Any input on Glencore?
Nah, I don't have any experience with Glencore on a personal level.
From what I have heard the vibe in metals and oil are pretty different there. Low turnover in metals whereas oil seems like a tough place for junior people.
I know a guy that traded NA petchem products. Apparently it is very intense, so even though in the office hours are not bad, you have to be on all the time and trying to make deals. He said that people are not necessarily mean, but nobody is particularly friendly and pals around. I don't know anybody in their other products, so perhaps it is different.
Are there any good things that can be said about Traf? Seems like taking her out of the picture would quite limit one's options (probably equivalent of eliminating one of GS/MS/JPM while recruiting), though I guess suggesting it has a cutthroat culture doesn't necessarily mean one wouldn't work there.
I don't want to say there aren't any good things because I haven't worked there personally so everything I know is just hearsay.I am sure there are some good things for certain people.
As for ag... I agree and it is why I took the pay cut and made the switch a few years back. That says a lot about me personally though so take that into account when reading my assessment of Trafi's culture.
Hopefully you are not in the Traffi Graduate Program. What I've heard is they almost never move into trading.
In general if culture is important to you then physical commodities isn't the industry for you.
Not sure I agree with that. Culture doesn't have to mean free lunches and ping pong tables, and while the "culture" on my desk is not something every one would be comfortable with, it's definitely something most of us enjoy. And pressure is kind of a given, mistakes can cost anywhere from thousands to millions as you move up in the business. That's the nature of businesses with razor thin margins.
Spoken like someone who has done this for a while. I second your comment
Where did you get the impression there is a culture at a company? Do you mean office, desk, what? My boss is not like the boss of another department. Please, I hope this doesn't surprise you. My advice, work for a small shop. Get your hands dirty, learn in the ins and outs, get close to a senior trader and follow him/her to client meetings. Cargill, Gencore, Trafi, Merc, they're big companies now. They aren't as lame as banks but they're trying their hardest to close the gap. If you're worried about culture, stick to a bank. When you are doing something real, rather than playing computer games, you realise that there are more important things than the correct shirt, suit, shoe combination.
I actually don't think that joining a smaller shop from the ground up is necessarily the optimum scenario. Before making the move, I started out with a bigger shop (think oil major / utility company.) and I really appreciated the training mentality of these places versus 'smaller' companies.
I am not saying that they are a bad place to begin. Far from it, for the right individual, this would work well and ultimately if one is committed to the sector they should take whatever 'in' they find. But, if I was starting out again and I was faced with that choice, I would still opt for a more structured programme of a larger corporation than the route you described.
I would also disagree regarding culture. Yes, dress code doesn't equate good/bad culture (although you will find that the trading houses are very prim and proper when it comes to fashion!) and yes this is a highly pressured workplace where attitudes differ vastly from desk to desk. However, working in an environment which suits your personality and with colleagues who you can be close and productive with are important cultural considerations for any job and caring about these does not make you unsuitable for this business.
I might chime in here. Company and desk culture is pretty important for a shop whether big or small. I’ve worked at places where they thought they were too big to fall that made them fairly arrogant in the market, and a small shop that appreciates business relationships.
Desks I have worked on and managed are driven by a no bullshit and fast pace environment. Teams must be available at all times, it’s not unheard of working on weekends dealing with shippers to have our cargo ready alongside ship for loading. There are accountabilities to your actions, and if you fuck up you will be in the lime light for a very long time until you prove yourself worthy again.
My desk is an extended family, and at times I see them more than my actual family. Everyone is across what others are doing and can pick things up for colleagues if they are travelling or busy with issues at home etc. Sick or holiday leave? We don’t care to be honest, most the time you can keep them accruing on your balance. Instead take a day or three off, we’ll cover your back. When our time comes you will too.
I wouldn’t consider joining any desk that doesn’t have a family-like or camaraderie culture, and to me that is what physical trading is.
Do the big merchants still have cultures like this? Or is it really only with smaller shops?
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