Commodity Trade and Sustainability

Dear Colleagues, 

The Special Issue calls for papers that address research on how sustainability impacts the global trade in commodities. Commodities are critical for the global economy as they literally power the world, feed the planet, and provide the essential inputs in all the devices and household appliances that make our lives easier. Chatham House estimated global trade in commodities for the year 2018 at 12.4 billion tonnes, with a value of over 5.8 trillion USD. Commodity trading involves the transformation of commodities in time (through storage), space (through shipping), and form (through processing) (Pirrong, 2014). Commodity trading firms (CTFs) are involved as intermediaries, being both buyers and suppliers, in manifold and geographically extended supply chains and global production networks (GPNs) in which they manage all kinds of risks and secure physical delivery for their customers. The largest CTFs are vertically integrated with upstream and midstream assets, exposing them more directly to various local community and environmental concerns. Sustainability has now become a top priority for the industry, which long operated in relative secrecy and avoided publicity altogether. Transparency in global value chains has increased enormously over the last several years, and digital tools have allowed for greater traceability of traded commodities all the way back to their origins. Pressure to take responsibility is not only coming from NGOs or final consumers. Major investors, buyers, and trade financiers are holding commodity trading firms accountable. So, commercial interests are also at stake, with demand altering market fundamentals. Sustainability is thus now considered a key performance indicator and extends beyond more traditional ESG policies to incorporate Sustainable Development Goals (SDGs) into CTFs’ business strategy. However, the challenges remain formidable. Increased transparency and traceability also put pressure on the business model of traders, typically trading fungible volumes hedged with financialized derivatives in which value is captured based upon arbitrage derived from information asymmetry. Implementing SDGs policies across various geographies and monitoring along complex supply chains remains cumbersome despite new technological capabilities. New opportunities also arise for CTFs, with renewables and organics emerging as product groups in their own right. This Special Issue welcomes papers that both conceptually and empirically focus on sustainability and the global trade in commodities. We welcome both (business) case studies of different commodity product groups (agri, softs, energy, and metals and minerals) and value chains addressing strategic interventions and governance concerns, as well as more technical analysis covering sustainability in commodities trade.

Dr. Wouter Jacobs
Dr. Tom Brady
Guest Editors

Manuscript Submission Information

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• Commodity
• Trade
• Sustainability
• Supply chains
• Global production networks