Mercuria Energy Group and Trafigura Group closed large super-short-term loans this month to boost liquidity amid wild swings in commodity prices following Russia’s attack of Ukraine, contributing to the surge in the volumes of syndicated and club loans obtained by global commodities traders in 1Q22 to date.
Mercuria closed a USD 2bn six-month facility which has an option to extend the tenor, while oil-and-metals-focused Trafigura completed the syndication of a USD 2.3bn nine-month multi-currency revolving credit facility, almost double from the initial underwritten amount of USD 1.2bn.
S&P Goldman Sachs Commodities Index (S&P GSCI), which tracks 24 commodities across all sectors, surged to its highest level since 2008 to 822.3 points on 8 March. While it receded to 684.4 a week later, it ended at 781.6 on 25 March, registering a 39.28% increase YTD.
The total global volume of syndicated and club loans obtained by commodities traders stands at USD 23.76bn-equivalent in 1Q22 to date - already the highest first-quarter tally since at least 2013.
Trafigura this month also completed its USD 5.295bn flagship European syndicated annual refinancing and a JPY 93.75bn (USD 786m) samurai loan, while energy trader Vitol Group sealed a JPY 81.2bn (USD 704m) samurai loan in February, after having obtained a USD 6.97bn-equivalent five-month loan in January.
Singapore-headquartered soft-commodities trader Olam International raised a combined USD 4bn in multiple bank facilities in January to progress with its reorganization plans. Olam Food Ingredients, created following a reorganization of Olam International, announced on March 24 that it doesn’t expect its planned London and Singapore IPO to take place in 2Q22 as anticipated due to market disruption amid the conflict in Ukraine.
