Switzerland has a long and varied history when it comes to commodity trading.
Its origins go back to the fairs of the 15th century, when merchants from South and North Europe met in Geneva and other Swiss market towns to trade goods.
The 19th century saw the development of powerful family-owned trading businesses, based in or around the country's main industrial and commercial centers.
Some examples are the Volkart Brothers (1851) based in Winterthur, and the Nestlé (1839) and André (1877) families in the canton de Vaud. Active in the trade of imported raw materials such as cotton, coffee or coca, these companies helped establish Switzerland as a global center of trade in the 20th century.
In the 1920s grain trading houses established themselves in the area, ostensibly to be closer to their major client, Nestlé. A number of ex-Ottoman Turkish traders also came at that time - the city of Lausanne being a convenient stop on the London-Istanbul Oriental Express.
The creation of the League of Nations and such organisations as the International Labour Organisation heightened Geneva’s “neutral” and “international” profile.
In the 1940s, Switzerland was positioned to become the ideal location for business in Europe: the Swiss franc being, with the US dollar, one of the two currencies freely exchanged. Moreover, the Swiss’ telephone system, excellent for the time, was essential for international trading.
Subsidiaries of US companies concentrated here throughout the 1940s and ‘50s. During the Cold War period, Switzerland offered a neutral place to establish relationships and accelerate administrative procedures for trade in the Eastern Bloc.
In the 1960s, Egyptian cotton merchants looking to move their operations out of Nasser’s Egypt came to Geneva. With the first oil crisis (1973-1974), a number of oil traders joined them. In the 1990s, it was the turn of the Russian oil companies to set up offices in the area, as well as in and around Zoug, not far from Zurich, and Lugano, in the Italian-speaking part of Switzerland.
Thanks to an extremely specialised expertise, an international openness, a political and economic stability and strong competences in the financing of commodity trading and shipping, the Swiss Commodity Hub has today a leading position in international commodity trade.
The history of commodity trading
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