NCO traders are fully aware, and they can penetrate the sources of the production in South America, Africa, sell directly to selected buyers in the supply chains in Asia. Our trading desks are consistently demonstrated in several regional and international markets. The target goal of more transparency and liquidity creates greater competition, which exerts downward pressure on prices, thus creating a great day for consumers. NCOs Commodity trading desks in Geneva, Dubai, and Athens (transportation & logistics) are multifunctional units focused on crude oil, agricultural products, metals, and other commodities, such as fossil by products, industrial metals, and precious metals and fibers, livestock, etc. Our Derivatives trading desks specialize in derivatives, such as options, futures, forwards, and swaps. A tremendous amount of our commodity trading involves purchasing and selling futures contracts through physical trading and derivatives trading standard activities. Our Traders make money for the company and themselves by buying commodities (or commodity derivatives) for the lowest price they can achieve and then selling them for a higher price. The buyer of a futures contract makes money if the future market price of the commodity exceeds the market price of the particular commodity at the time of purchase. Traders have great and new opportunities to arbitrage and match supply and demand throughout the energy supply chain, using shipping and storage facilities.
The group has unparallel long-only commodity futures strategies that provide robust inflation hedges and generate higher risk-adjusted returns than leading commodities benchmarks. NCO knowledge adds value to these strategies through active discretionary execution based upon fundamental and quantitative market analyses. These strategies have been designed to monetize opportunities in the term structures of commodity futures markets. NCO robust Commodity The NCO Robust Commodity ('NRC') is a captive managed long-bias commodity strategy that targets to deliver higher risk-adjusted returns than the Bloomberg Commodity Total Return Index ('BCOMTR') while also maintaining the capacity to mitigate the risk on market fluctuations and deep throughs to preserve the invested capital. To achieve its return targets and objectives, the strategy focuses on deploying the optimal investment approach for the prevailing market conditions. During bull markets, the strategy's primary task is to deliver a return above the BCOMTR by positioning the portfolio to take advantage of those markets where the best risk-reward profiles are to be found. During bear markets, the primary task is to minimize any market exposure that may significantly dilute the invested capital. In extreme circumstances, where no reasonable risk-reward opportunities can be identified, or the asset class is at high risk of price dislocation, the strategy may avoid market exposure entirely. The strategy and the invested capital may also deploy short positions but will never be net short.
The investment philosophy of NRC is discretionary rules-based, and the investment process is centered on a belief in the efficacy of holistic market analysis. This means that portfolio positioning is determined by a repeatable and consistent combination of rigorous top-down macroeconomic, bottom-up commodity-specific, technical, and sentiment analyses. Given that an integral component is to attempt to preserve capital, tracking error is not included in the investment framework. The group's primary concern is not beta exposure across the range of market outcomes,
ALL INVESTMENTS INVOLVE RISK, INCLUDING LOSS OF PRINCIPAL. PAST PERFORMANCE RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
Counterparty Participants & Partnerships
NCO Deals directly with producers i.e., Upstream oil companies (exploration & production), Coal mines
Upstream Gas, Ore mines, soft commodity producers
On upstream trading, NCO deals with integrated traders (majors & NOCS), Large independent traders, integrated agricultural, and midsize and small niche traders
On the downstream NCO deals with integrated traders (majors and NOCs), large independent traders, integrated agriculture, midsize and small niche traders
NCO deals with PROCESSORS, integrated refineries, independent refineries, trading refineries, Gas fractionation, coal washing (now obsolete almost), Metal smelters, milling, and grinding for soft commodities
On the consumer side, NCO deals with power companies' petrochemical companies, Downstream oil firms, industry, etc. Nco has several partnerships across all sectors of the industry
Our company is constantly assessing and disclosing the climate alignment of chartering activities. It establishes a shared, global baseline to quantitatively assess and disclose whether chartering activities align with adopted climate goals. Thus, it also serves as an essential tool to support responsible decision-making. Currently, significant charterers are signatories to the SeaCargo Charter. Signatories are bulk cargo owners from various segments – grains & agricultural products, chemicals, energy, metals & mining- and commodity traders and shipowners who are interested in advancing good environmental stewardship through their business activities. Signatories commit to implementing the Sea Cargo Chartering their internal policies, procedures, and standards and to work in partnership with ship owners, disponent owners, logistic, and commodity outfits. More charterers are expected to become signatories soon. NCO is part of the imitative and adheres to the clean ocean environment and better life for humanity.
-On the actual trade:
National Commodity Operators S.A. is a market participant concentrating in sourcing various dry and petroleum products with the further arrangement of sales and transportation of those cargoes and often taking a position on the commodity trading and financing. The company also has extensive experience chartering and managing the tanker sector: product carriers / Aframax / Suezmax and VLCCs. On the dry bulk sector, the NCO team often charters dry bulk vessels for its own and third-party concerns eco vessels from small handy sizes modern Supramax / Ultramax / Kamsarmax and Cape-size vessels. Several different groups of companies are involved in the transport chain, some directly and others indirectly. NCO is a part of a diversified trading and logistics group – NCO Group belongs to the same industry as other sea transportation and trading companies. Still, they seem to have little else in common. The direct players are the cargo owners, often the primary producers such as oil companies or iron ore mines, and the shipowners (shipping companies). However, in the last 20 years, two other increasingly important groups have joined: crude oil and petroleum products. Traders who buy and sell physical commodities such as oil, for which they need transport, making them significant charterers and the so-called Operators who charter ships against cargo contracts for an arbitrage. Ship managers and brokers are also involved in the day-to-day commercial operation of the business. Each has a slightly different perspective on the business. This is what NCO does as an Operator Company in commodity and maritime space.
The company has a customer loyalty program to maintain the supply chain and commodity flow. The program rewards loyal customers/producers who frequently engage with NCO. Our cause marketing or the cause-related marketing lings NCO and its commodity delivery services to a social cause. The knock-on effects on the producers are enormous, and the relationship is solidified, resulting in the repetition of the business and loyalty channel. Commodity sourcing loyalty programs are mixed models designed to incentivize repeat purchases by providing NCO commodity producers with quick and efficient execution in the energy sector with seed capital flexible trading terms freight discounts in the agricultural sector. Loyalty programs come in many forms, ranging from personal relationships to sophisticated hedging mechanisms, straightforward, transparent contracts, and advance payments at early stages. NCO values relationship marketing and constantly develops scarcity markets and undercover markets.
A well-thought-out loyalty program can also:
- Attract new customers;
- Retain existing customers;
- Reactivate dormant customers; and
- Nudge them to spend more.
- The commodities sourcing and the complexity is evident in the agricultural
- rural areas where to profit margins are higher and the
NCO executives have to deal with:
Access – distance to market:Although market access has been slowly improving, networks of trading intermediaries have been expanding deeper and deeper into more remote production areas, with access improvements (road network, transport services) and cell phone network coverage.
Information Asymmetries: price data found substantial price differences for the same crop between districts within the same province and at different season times. A delegate issue for the NCO executives to mitigate price stability across its suppliers.
Distrust: Farmers do not trust the weights quoted by the traders using traditional scales, which they feel are manipulated. Some farmers pollute their deliveries with dirt, stones, and other items to increase their income.
Limited Awareness: Poor education is often exploited by unscrupulous traders who allegedly tamper with their scales, pay lower prices, don't share information on market standards and quality or engage in other forms of duplicity to maximize their profits. NCO deals with these issues and brings the producers on its platform transparent model and planning. Bargaining power: have minimal bargaining power despite efforts from projects such as the IFAD funded Promotion of Rural Markets Program (PROMER), which have provided substantial support towards their development, having devoted years towards the development of farmer groups (associations and cooperatives)
Excessive Bureaucracy (transit barriers): an inordinate number of bureaucratic regulations leading to increased transaction costs to the NCO traders that try to mitigate the trading brisk market delays and export/import documentation.
