Systemic Risk of Commodity Traders
Type
working paper
Date Issued
2023-08-24
Author(s)
Abstract
We examine the disruptions to global commodity flows following the bankruptcy of a commodity trading firm. The physical commodity network is operated by a handful of large traders that are responsible for the timely delivery of raw materials and inputs to industrial production. We propose a model that simulates the resilience and response time of the network following a shock. Our results suggest that a number of commodity traders carry significant systemic risk. The forced removal of a trader from the network has considerable implications for the prices and availability of physical commodities over a period of 6 to 12 months.
Keywords
Systemic Risk
International Trade
Commodity Trading Firms Q40, Q41, Q43
File(s)![Thumbnail Image]()
Name
Systemic_Risk_Commodity_Traders_v9.pdf
Size
2.38 MB
Format
Adobe PDF
Checksum (MD5)
9a38e443e627677645e7a9c7ad8add90