Singapore, March 12 : Asia's commodity business will find the going even tougher after Swiss-based Andre & Cie, a 123-year-old commodity merchant, became the latest casualty of consolidation in the multi-billion dollar global raw materials market, regional traders said on Monday.Wafer-thin, or non-existent margins on cash deals, plus closer banking scrutiny on lending to the commodity trade, spell harder times. Big, well-capitalised and well-managed firms will weather the storm, but smaller ones will find it less easy.
The firm, saddled with $400 million bank debts, said it had been unable to convince its 43 banks to agree to a standstill agreement to keep credit lines open. The troubles followed huge 1999 losses in speculative trading on Chicago's soybean market.
On Friday, the family-owned Andre, once one of the world's top five grain trading groups, said it had won protection from creditors after failing to gain more support from banks that had backed earlier restructurings.
Andre's creditor protection surfaced five months after the Singapore unit of Bangkok-based commodity trading firm G Premjee Ltd was put under the judicial management of Deloitte Touche Tohmatsu. Court documents put bank debts of the firm, one of Asia's oldest commodity trading names, at $111 million.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
