Commodity brokers buy and sell contracts for commodities on behalf of their clients. They try to negotiate a transaction that will give their client the most favourable terms available. Commodities include financial products as well as basic goods such as oil and gas, metals or wheat.
Also known as
- Broker, Commodity
- Commodity Trader
As a Commodity Broker, you will buy and sell contracts for your clients. You will need negotiation skills as you will need to find the best possible price for your client!
The term 'commodities' is used to describe things like metals, petroleum and financial products. Some examples of these are:
- precious metals - gold, silver and platinum
- base metals - copper, zinc, tin and lead
- energy - crude oil and natural gas
- financial products - gilts, bonds and interest rate contracts
- foods - cocoa, coffee, sugar and wheat
Firstly, you will talk to your client and see which commodity they would like to buy. You will then communicate with other Commodity Brokers or the public and try and get the most profitable deal. The seller may be international or in the UK.
You will usually specialise in one or two commodities and have lots of knowledge about them. This career involves carrying out lots of research into these commodities from online or press articles so you have the best knowledge for your client.
In some cases, Commodity Brokers might visit the country from which the commodity originates in order to carry out quality checks.
Being able to read, write and speak Welsh may be an advantage when you’re looking for work in Wales.
Personal Qualities and Skills
To become a Commodity Broker, you'll need to be:
- able to cope with pressure, long hours and a hectic working environment
- confident, decisive and energetic
- able to retain the confidence of your clients
- intuitive, quick-witted and alert
Languages can be an advantage. English is the global language of the major exchanges, but communicating with clients in their own language can be a significant advantage in gaining new business.
Pay and Opportunities
The pay rates given below are approximate:
- Starting: £40,000 - £50,500
- With experience: £58,000
Salaries are generally increased by performance-related pay and bonuses.
Hours of work
Typically, a Commodity Broker’s working week is 37.5 hours, Monday to Friday, but many work longer hours and at weekends.
Hours of work also depends on the type of commodity you will specialise in. This is because Foreign Exchange for the commodities are different.
Where could I work?
The work of Commodity Brokers is centred on the international exchanges in the City of London, which act as market-places for worldwide commodity dealings. Banks or securities houses also employ Brokers. Other employers are large manufacturers with their own Broking departments.
Opportunities for Commodity Brokers occur with employers located in London, as the major financial centre of the UK.
Where are vacancies advertised?
Vacancies are advertised in national newspapers, on financial job boards and on employers' websites. Applicants can also write speculatively to Broking firms.
Entry Routes and Training
To become a Commodity Broker, you will need a degree in a related subject. This includes a degree in economics or foreign languages, which could be useful for this career.
Other relevant subjects you could consider include science, engineering or agriculture. Some entrants might have a postgraduate qualification.
A great way to get into this career is through an internship. Take a look at our information article '
Training is traditionally carried out on-the-job. New recruits sometimes begin work in a support role. They usually spend time moving around various departments.
New entrants must pass an exam that is recognised by the Financial Conduct Authority, to become a registered Commodity Broker. For example, the Chartered Institute for Securities & Investment (CISI) offers the certificate in commodity derivatives.
An approved higher (level 4) qualification is required for Commodity Brokers giving investment advice to clients.
Examples include the CISI investment advice diploma and the investment management certificate, plus the first level of the chartered financial analyst qualification, from the CFA Society of the UK.
Further study could lead to a qualification such as the CISI masters in wealth management.
Previous experience within a financial environment will be really useful for this career.
Commodity Brokers can progress by handling larger accounts and by moving to larger organisations. Promotion to Senior Manager and Director posts is possible.
Rehabilitation of Offenders Act
Working as a Commodity Broker in securities is an exception to the Rehabilitation of Offenders Act 1974. This means that you must supply information to an employer about any spent or unspent convictions, cautions, reprimands or warnings, if they ask you to.
This is different from other careers, where you only have to reveal information on unspent convictions if you are asked to.
For entry to a degree course, the usual requirement is:
- 2/3 A levels
- GCSEs at grade C/4 or above in 2/3 other subjects
You are likely to need English and maths at GCSE grade C/4 or above.
Alternatives to A levels include:
- BTEC level 3 qualifications
- the International Baccalaureate Diploma
However, course requirements vary, so please check college/university websites very carefully
Some universities accept the Welsh Baccalaureate as equivalent to 1 A level.
Professional institutesProfessional institutes have the following roles:
- To support their members.
- To protect the public by keeping standards high in their professions.
For more information on the institute(s) relevant to this career, check out the contacts below.
Publisher: Financial Skills Partnership (FSP)
Address: 51 Gresham Street, London EC2V 7HQ
Tel: 0845 2573772
Financial Skills Partnership (FSP)
Skills for the financial, finance and accountancy sectors
Address: 51 Gresham Street, London EC2V 7HQ
Tel: 0845 2573772
Specialists in graduate careers
Address: Unit 6, The Quad, 49 Atalanta Street, Fulham, London SW6 6TU
Tel: 020 7565 7900
Getting into Business & Economics Courses
Author: Carly Roberts Publisher: Trotman
London Institute of Banking and Finance
Address: 8th Floor, Peninsular House, 36 Monument Street, London EC3R 8LJ
Tel: 020 7444 7111
CFA Society of the UK
Tel: 020 7648 6200
Chartered Institute for Securities & Investment (CISI)
Address: 8 Eastcheap, London EC3M 1AE
Tel: 020 7645 0600
Career Guide 2011
Publisher: CFA Society of the UK
People Exchange Cymru (PEC)
Public sector recruitment portal for Wales