Moving into ags

I know there are a few traders here who switched from energy/metals to the ags side of things. I've secured a very good opp on the energy/metals side but I've always wanted to work in ags, especially at a smaller family-type or niche shop, where ideally I'd also get some exposure to some investment work as well.

This opp has decent brand name/training and I'm inclined to take it given this job market market. I know most people here want to make the opposite move, but any thoughts/advice/comments appreciated.

For context, main reason for wanting to do ags:

  • Geography: interest in spending significant time at origin + there also seems a lot more location diversity in ags when it comes to rotating junior hires across commods/functions--while I've  seen some ags profiles where folks spend their entire career in Geneva, I'm thinking more those who do 5-10 countries before settling down in an HQ. OTOH it seems quite common for a crude guy to spend entire career in Houston.

  • much more interested in the underlying commods + more niche commods (eg. would love to work in pulses or lumber)

  • more opaque markets / less financial engineering (maybe?)

  • more responsibility more quickly, perhaps because things are inherently more simple, eg. junior coffee trader sent to origin as the only kid on the ground, running the entire export ops

  • at the major traders (ie., comparing Glencore/Trafi/Vitol to ABCD), more busdev/"corporate" roles available overall, which could be an interesting transition, eg. LDC has a new VC arm, you could do corpdev at Cargill, etc. while I think GTV's combined M&A departments probably have the same amt of seats as Cargill's yearly corpdev MBA intake.

  • more family shops with good LT opportunities/very good cultures (could be wrong here but this is my impression)

 

 

Comments (14)

 
Aug 27, 2020 - 3:45pm

Not sure what you're asking here... are you wanting someone to tell you that going into the ag space sounds like a better fit for you given your interests? If so, it sounds like the ag space would fit into what your interests are and you should do that.

 

And yes, there is less financial engineering in the ag space. Especially something like pulses where there aren't even any futures traded on them.

 
Most Helpful
Aug 28, 2020 - 5:16pm

Just one man's opinion but go with what you want to do - which sounds like its ags. I made the switch from energy to ags a couple years back and am very happy I did it.

Having said that, when I left energy I passed up a spot at one of the large trade shops and when I turned it down I had a conversation with the head of HR that stuck with me. He told me that while I was leaving money on the table I had a chance to be a "big fish in a smaller pond" and he was absolutely right. After spending some time in energy and learning how they do things I have been able to bring over some ideas to the ag space that my company was not aware of before. As a result, I have been able to climb the ladder here much quicker than any of my peers have back on the energy side. Do I still have limited financial upside compared to what I would have before? Absolutely. But I also have much more autonomy, have been trusted with making/formulating strategy decisions, and never have to report in to my boss except on the weekly call we have. That was not the case in energy where I felt like I was much more just a cog in the machine. Just something to keep in mind as I know these two paragraphs contradict one another in a way.

 
Aug 28, 2020 - 7:49pm

If you have an offer in energy/metals starting right now vs nothing in ags you should take the energy/metals one as long as its a reasonably recognizable shop. Having at least some sort of commodity background is a huge differentiator vs the masses of undergrads and the "going from a big pond to a smaller one" effect could be very important.

Even within a commodity, many of the smaller shops have no clue what things look like at the bigger ones. The basic thinking might be the same but knowing how assets work, what makes the big producers tick... much easier to wrap your head around that at one of the big guys. There are basic logistics things that small shops overlook because they don't have the manpower or experience, and that ends up costing a lot to them on their realized P&L. Can't tell you the number of times I have fought vessel owners, stevedores, barge lines over things where "no one has ever asked us that before."

Until you have a decent size book and solid P&L, your downside from moving to ags will be relatively limited. Yes you will have to learn some new ops and probably take a pay cut but that shouldn't take more than a couple years.

 
Aug 29, 2020 - 4:52am

I currently work at a large agri shop.
My advice would be to take what you have right now (assuming it is a good offer at a good name + no alternatives that you might like) and you will have the opportunity to switch within two years if you are proactive and show your interest. Moving while you are a "generalist" (i.e. early on in your career) will definitely make the transition smoother and as previously mentioned you can even be considered an added value to wherever you will go (given your different perspective).

All the best!

 
  • Prospect in S&T - Comm
Sep 11, 2020 - 12:53am

Thanks! Do juniors in ABCDs typically specialize on a commodity early? I'm fairly confused based on Linkedin. It seems there are juniors switching commodities every two years for up to 5-6 years, until they actually settle down. And there are also mid-level seniors who switch around quite a bit, eg. go from managing a sugar desk to a grain desk. I would assume this happens a lot less on the energy/metals side. What has your experience been like/is it very desk dependent? Do you get a much of a choice for what product you'd like to work on LT?

 
Sep 11, 2020 - 12:35pm

It seems recently like there has been a push to get people exposed to different sides of the business especially when it comes to junior employees, but the goal is to gain experience and responsibility as you go up. They value getting diverse experiences from different parts of the business. If you're originating a couple crush plants for 2 years, the next step might be to be in merchandise a few shuttle loaders or to trade corn milling byproducts. The nuts and bolts of the job are the same no matter the responsibilities, but its to gain exposure to a larger book where you can show that you can develop a strong PnL, and if you can demonstrate that you are successful in your role, they will put you in a new one with more responsibility 

Start Discussion

Total Avg Compensation

November 2020 Investment Banking

  • Director/MD (18) $713
  • Vice President (52) $334
  • Associates (272) $228
  • 3rd+ Year Analyst (39) $161
  • 2nd Year Analyst (152) $153
  • Intern/Summer Associate (139) $139
  • 1st Year Analyst (593) $130
  • Intern/Summer Analyst (566) $82

Leaderboard See all

1
LonLonMilk's picture
LonLonMilk
98.4
2
Jamoldo's picture
Jamoldo
98.3
3
Secyh62's picture
Secyh62
98.3
4
CompBanker's picture
CompBanker
97.9
5
redever's picture
redever
97.8
6
frgna's picture
frgna
97.5
7
Edifice's picture
Edifice
97.5
8
bolo up's picture
bolo up
97.5
9
Addinator's picture
Addinator
97.5
10
NuckFuts's picture
NuckFuts
97.5