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Introduction to the Swiss agricultural commodity trade sector

Switzerland is not only home to the world’s largest oil and mineral traders; it is also a significant trading hub for agricultural commodities such as coffee, cocoa, sugar, or grains. The majority of the globally significant agricultural traders are either based here or operate important trading branches in the country. The sector is highly concentrated with ever fewer powerful companies who also control the production and processing stages of the industry. Moreover, the sector poses several risks: human rights violations such as the lack of living income and wages, forced and child labour, deforestation, and corruption are widespread. Switzerland as a home country to many of the world’s most significant traders, bears great responsibility when it comes to ensuring transparency and to guaranteeing respect for human rights.

Population growth, rising income levels and urbanisation are driving up demand for food. Growing demand for meat and agro-fuels leads to an even greater increase in the production of agricultural commodities such as soy, corn, and sugar cane. These developments have put in motion a structural transformation of the global agro-food system accelerated by technological progress and facilitated by economic policies biased towards free trade and an export-led development model. In recent years, take-overs, joint ventures and mergers have led to fewer multinational companies dominating different stages of agricultural value chains. Today, a small number of powerful actors control large parts of our entire agro-food system. In addition, many companies have come to exert considerable control over the production stage as well.

It will come as a surprise to many that at least 50% of global grain trade is handled by Swiss-based actors, and that 40% of globally traded sugar is dispatched from computers in Switzerland. Similarly, Switzerland has its hand in at least 30% of cocoa, 30% of coffee, 25% of cotton, and 15% of orange juice traded globally. There can be no doubt that the country has become one of the most important trading hubs for agricultural commodities and over the last decades many of the world’s leading agricultural traders have set up their trade offices along Lake Geneva or in central Switzerland. Lured by an attractive tax policy, a discreet and business-friendly environment, most agricultural commodity traders remain largely unknown to the general public. This is also a result of the fact that commodity trading in Switzerland is comprised largely of so-called transit trade, so that goods traded via Switzerland do not show up in import and export statistics.

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