In all things, knowledge is power. This is especially true when it comes to commodity trading. A successful trader needs to know much more than how to obtain a letter of credit and contact sellers and buyers, he or she needs to know the industry they are working with inside and out. If you are trading Brazilian sugar or Ukrainian sunflower oil, for instance, you need to know and understand the Brazilian sugar industry and the Ukrainian. You need to be able to answer questions like:
What is Brazil’s or Ukrainian production capacity?
Who are the major producers and exporter in Ukraine or Brasilia?
When are the peak season and the best time to enter in contract?
What are current market rates and export prices?
Many get caught out in trade scams because they are lured by promises of impossibly large shipments for ridiculously low prices. Many times the trader being scammed does not know that the shipment they are being promised is pure fantasy, because they do not understand the market.
For instance, take the following example. A scammer offers 20 million tons of Brazilian ICUMSA 45 sparkling white sugar or 500 thousand metric ton of sunflower oil.
Suzie Trader leaps at the deal, not knowing that shipments of millions of tons of ICUMSA 45 sugar are virtually impossible to obtain for a new buyer. In reality, Brazil produces relatively little ICUMSA 45, and the bulk of it is sold ahead of time to traders who purchase it on the futures markets. Small amounts of Brazilian sugar can occasionally be obtained if there is a surplus after harvest, but new entrants to the market will not be able to secure large shipments in their first foray into the market.
In spite of this being fairly common knowledge which can be obtained with just a little research, many people are scammed out of millions of dollars after attempting to buy several million tons of ‘discounted’ products . Argument products were for other client but for some financial reason they fail.
in conclusion we can advice to read our post:
scammer’s arsenal is the victim’s own sense of greed
thanks for reading we hope that we helped in your deal, pleas comment if you need some extra replay or consultation