Commoditrade ApS, an agricultural trading platform founded in spring 2018 by Danish entrepreneurs Julie Koch Fahler and Ida Boesenlaunched its operations in Romania on Wednesday, September 4. Romania is the first country in Eastern Europe where this market is available.
Actors in the Romanian agricultural sector will be able to use this platform to exchange cereals and other agricultural raw materials and organize their freight. The Commoditrade platform creates better access to the market in an optimized way, where digitization limits the distance between buyer and seller and gives the possibility to compare prices and other contractual conditions, internally in Romania and beyond. across borders, to increase farmers’ bargaining power and give traders easier access to the market, according to the company.
“In the agricultural sector, we are looking at a gap where many farmers are typically only served by a few trading houses. When we open the market and provide access to more potential buyers or sellers in the market to sell or buy, we ensure that the farmer and the trading house get more offers when they enter the market” , says Julie Koch Fahler, co-founder of Commoditrader. .
“Today, normally, a farmer calls 2 or 3 traders to ask for prices and conditions. In general, you can say that the more you ask, the more likely you are to get a better price for your goods and an efficient settlement. When Commoditrader then offers a service that spreads the sell/buy interest, you ensure that you get the best price available in the market – also in all geographies,” she concludes.
The market is easily accessed by creating a user profile, which can be a buyer, a seller or both. Once the profile is set up, the user can create a listing to grab the attention of buyers or sellers. All prices are indicated in the platform, including the cost of freight. The user can choose their own freight provider and the platform will calculate all the logistics costs involved or one can book the freight from the platform. If the buyer and seller decide on the transaction, they can enter into a contract on the platform, with all counterparty information available before entering the transaction.
The platform offers the ability to segment the market, allowing users to create listings visible only to those they want to trade with, such as traders with high credit scores, high turnover, or geographically close.
Commoditrader ApS was founded in the spring of 2018 by Julie Koch Fahler and Ida Boesen, two Danish women, and a group of large Danish farmers with farms in Denmark, Lithuania and Russia. The Commoditrader.com platform was launched in Denmark 4 months ago and today serves around 15% of Danish farmers, who account for 40% of the country’s grain production. Commoditrade.com will be launched across Eastern Europe over the next few months, starting with Romania.
“We chose Romania because it is a rapidly developing market, with a population of open-minded people ready for change – we see this as a key aspect of opening up to a new way of doing business . Romania is also one of the largest grain producers in Europe, although the trade structure requires optimization in order to give better market access for the Romanian farmer, and therefore it is one of the highest priorities of our business,” says Ida Boesen, co-founder of Commoditrade.
Romania has 53.4% of agricultural land in its total area and, although it accounts for a third of the agricultural holdings in the European Union, far more than any other EU member, it only accounts for 4% of production total agricultural area in the region, according to Eurostat data for 2016. Romania registered 3.42 million farms in 2016 and its total agricultural area amounted to 12.5 million hectares (7.3% of total agricultural land in the EU), ranking 6th in the EU in terms of agricultural area. The share of small holdings (less than 5 ha) in the total number of holdings in Romania is the highest in the EU, respectively 92.2%. Only 4.7% of farmers are under 34 (6.0% in the EU), while 41% are over 64 (31.1% in the EU).
(Photo source: courtesy of the company)