The HC Commodities Podcast

Episode: Schism & Domination: Founding Trafigura & Glencore: Mark Crandall Part 2
Host: Paul Chapman (HC Group)
Guest: Mark Crandall
Date: November 5, 2025

Overview

In this gripping Part 2 interview, Paul Chapman continues his conversation with Mark Crandall, a founding figure in global commodity trading. The episode delves into the dramatic early 1990s schism at Marc Rich & Co.—shedding light on the secretive formation of the world’s dominant trading houses: Trafigura and Glencore. Through Crandall’s firsthand recollections, listeners gain unprecedented insights into leadership struggles, the critical choice to own physical assets, and the evolution of commodity markets. The episode closes with a thoughtful analysis on the future role of trading houses in energy transition and new commodities like green ammonia.

Key Themes and Discussion Points

1. The Genesis of Asset-Backed Trading (01:34–07:05)

• Pioneering Asset Ownership
  • Marc Rich’s strategic shift in 1991–92: buying commodity-related assets (e.g., mines, processing businesses), starting with the Swiss company Züd Elektro (later Xstrata).
  • Quote:

    “Mark pioneered the concept of purchasing commodity related assets… That was actually, in a way, Mark's final great contribution to the business.”
    — Mark Crandall (07:05)

2. The Schism—Marc Rich & Co Fallout (07:20–15:15)

• Dramatic Departures

  • Internal conflicts erupt among Marc Rich’s leadership (Willie, Claude, Manny, and others).
  • Claude’s resignation catalyzed by his father’s death; Manny’s misunderstanding leads him to resign in solidarity.
  • Crandall promoted, but soon faces the same structural frustrations with Marc Rich’s concentrated ownership.

• Power Struggle and Ownership

  • The quest for democratized ownership versus Marc Rich’s central control.
  • Quote:

    “Mark wasn't the dominant owner for most of what we think of as Marc Rich and Company… What was happening here in very early 93 was ownership had become very concentrated in Mark, along ultimately with control.”
    — Mark Crandall (12:36)

3. Negotiating the Glencore Takeover (15:30–21:00)

• Redefining Control, The Dinner That Changed Everything

  • Crandall is asked to broker the sale of Marc Rich & Co to a group of remaining partners.
  • A week of secret negotiations culminates in a term sheet and eventual buyout.
  • Right to change the company name established once buyout threshold met.

• Quote:

  “Mark agreed to sell the company… Once we got him below 50%... we would have the right to change the name. And indeed… the company had changed its name to Glencore.”
  — Mark Crandall (19:25)

4. Trafigura’s Birth: The Other Half of the Schism (20:11–26:40)

• The Split Becomes Official

  • Discord in further negotiations drives Claude and close colleagues (including Crandall) to form Trafigura, initially as “Raw Materials Trading,” then as Trafigura, a name chosen for its neutrality.
  • Quote:

    “The Dutch lawyer, that was the only one he had, so we bought it. And then… we finally came to the conclusion that the fact that it seemingly meant nothing was actually advantageous…”
    — Mark Crandall (25:50)

• Founding Team Make-Up

  • Claude’s circle and the key metals traders set the foundation for Trafigura; the rest of the former leadership complete the Glencore transition.

5. What Made Trafigura and Glencore Special? (27:55–35:41)

• Market Dynamics and Barriers to Entry

  • Only Trafigura and very few others (like Mercuria) grew into major players; most aspiring trading companies failed.
  • Quote:

    “There were many, many days when I didn’t think we were going to make it… Trafigura led by Claude, had something that all those other guys didn’t. And I attribute it to… the concentration on metals…”
    — Mark Crandall (27:55, 29:05)

• Leadership, Talent, and Vision

  • Claude’s talent was identifying and empowering young talent, welcoming people smarter than himself.
  • The contrasting leadership styles—hiring “up” rather than “down”—as a core cultural differentiator.

6. Why These Houses Came to Dominate (36:02–40:14)

• Economic Moats—Scale and Optionality
  • Modern trading: Most cargoes lose money on paper; only large-scale global players can capture rare “happy accidents” through scale and optionality.
  • Quote:

    “If you want to start up a competitor to Trafigura, you [need] enough money to go sign 50 contracts, each of which is a guaranteed money loser… That’s why these people have become dominant, because the size of the moat is just bigger and deeper than it was 30 years ago.”
    — Mark Crandall (39:08)

7. Reflections on Leaving Trafigura and the Modern Era (40:32–47:19)

• Departure and Changing Industry Landscape

  • Crandall leaves Trafigura in 2005 after a legal dispute over an Iraqi oil cargo.
  • Trading houses’ centrality grows through price crises, regulatory change, bank withdrawals, and global events like Russia’s invasion of Ukraine.

• Concerns for the Future

  • Regulatory scrutiny, changing globalization patterns, transparency, and evolving talent demands.
  • Optimization now as important—if not more—than traditional relationship-driven trading.

• Quote:

  “Your star performers were the ones that had the customer relationships and now your star performer is probably the optimizer who’s running the book and figuring out the most clever way to squeeze the extra dollar out of that optionality…”
  — Mark Crandall (47:19)

8. Long-Range Value: The Importance of Strategic Bets (49:56–51:05)

• Bets on Big Trends, Asset Classes, and Teams

  • The major trading houses’ success tied to team-building and strategic decisions to enter new asset classes (e.g., metals, coal, LNG).

• Quote:

  “Where is the money made? The money’s made on really big strategic decisions which then get translated into tactical decisions, but really big picture stuff and then building teams of people…”
  — Mark Crandall (50:21)

9. The Next Schism: Trading Houses, Energy Transition & New Markets (52:05–61:33)

• Green Commodities & The Marketless Future

  • Challenges in new markets like green ammonia—no reference prices, lack of forward buyers, and the chicken-and-egg problem in market formation.
  • The crucial role trading houses might play as “market makers” in nascent commodities—if someone is visionary enough to take early and sizable risks.

• Quote:

  “Unless governments step in and backstop some of this, it’s going to be very hard to get it off the ground.”
  — Mark Crandall (56:44)

• Key Insight:
  The next wave of fortunes may be made where moats don’t yet exist—green commodities and new forms of energy.

Notable Quotes

• “Mark’s final great contribution to the business [was] purchasing commodity related assets…”
  — Mark Crandall (07:05)

• “What was happening here… was ownership had become very concentrated in Mark, along ultimately with control.”
  — Mark Crandall (12:36)

• “Mark agreed to sell the company… Once we got him below 50%… we would have the right to change the name…”
  — Mark Crandall (19:25)

• “Trafigura…we had to buy an off the shelf company. And the Dutch lawyer, that was the only one he had, so we bought it. And then… the fact that it seemingly meant nothing was actually advantageous.”
  — Mark Crandall (25:50)

• “He loved being around people who were really smart and would also, you know, sit there and just listen to someone explain their business plan to him…”
  — Mark Crandall (33:17)

• “If you want to start up a competitor to Trafigura, you [need] enough money to go sign 50 contracts, each of which is a guaranteed money loser…”
  — Mark Crandall (39:08)

• “Now your star performer is probably the optimizer who’s running the book…”
  — Mark Crandall (47:19)

• “Unless government step in and backstop some of this, it's going to be very hard to get it off the ground.”
  — Mark Crandall (56:44)

Timestamps for Key Segments

| Segment | Start | End | |-----------------------------------------------|--------|--------| | Asset Ownership & Xstrata Story | 01:34 | 07:05 | | Schism & Departures at Marc Rich & Co | 07:20 | 15:15 | | Negotiating the Glencore Buyout | 15:30 | 21:00 | | Trafigura’s Formation | 20:11 | 26:40 | | Barriers to Entry & Trading House Moats | 36:02 | 40:14 | | Modern Roles in Trading Houses | 47:19 | 49:56 | | Trading Houses & Energy Transition/Green Ammonia| 52:05 | 61:33 |

Memorable Moments

• The deal-making dinner in Zug that resulted in the Glencore buyout plan. (15:30–19:25)
• The casual, almost accidental naming of Trafigura and why a non-meaningful name won out. (25:50–26:40)
• Crandall’s honest doubts about Trafigura surviving (“many, many days when I didn’t think we were going to make it”). (27:55)
• Vivid tales of old-school trading relationship-building—wedding trips to remote villages, now a relic of a bygone era. (47:19–49:56)
• The challenges of pricing and market making for new green commodities, highlighting the disconnect between producers and consumers. (54:00–61:33)

Conclusion

This episode provides an authoritative account of how two of the world’s largest and most influential commodity traders—Glencore and Trafigura—came to exist, tracing their roots to a single fractious year at Marc Rich & Co. Mark Crandall’s insights reveal the crucial importance of strategic vision, asset control, and the dynamic, evolving nature of trading talent. As the sector faces the uncertainty of the energy transition and entirely new commodities, Crandall underscores the growing barriers to entry—but also the boundless opportunities for those willing to bet big and early on the next wave.

For more insights from industry leaders in commodities and energy, visit www.hcgroup.global.