EXIM: Swiss Commodity Trader's $400 million Backstop Drawn

Global commodity trading powerhouse Trafigura announced the establishment of $400 million revolving credit facilities subsidized by the Export Import Bank of the US (EXIM).

Financial Institution Buyer Credit (FIBC) policies backstop credit lines for Geneva and Singapore based Trafigura to broker natural gas purchases from the US “primarily to European Buyers,” according to EXIM.

Each policy is for $200 million, with a 90 percent guarantee, for a taxpayer exposure of $360 million. The subsidies to Trafigura’s bankers, Citibank and Credit Agricole “could support over 12,000 U.S. jobs,” according to EXIM statements.

Platts reports Trafigura signed a similar credit facility with the Saudi Exim Bank at the end of September to trade non-oil commodities produced in Saudi Arabia. The company has interests in US LNG exports. It has a 15-year offtake agreement with Cheniere for 1 million mt/year of LNG, which became effective in 2019.

Trafigura, which reported profits of $7 billion last year, has been under investigation by the US Department of Justice and the CFTC for commodity price manipulation, and was one of the biggest buyers of Russian oil before the war. The firm continues to trade with Moscow, according to reporting by the Financial Times, most recently importing Russian Diesel to Argentina.

The CFTC and Justice investigation may be connected to Trafigura's reported association with Brazilian businessman Jorge Luz, known as the "Deacon of Bribes" in the Petrobras "Car Wash" scandal that has embroiled fellow Marc Rich protégée trader Glencore.