There may be opportunities for commodities talent markets in 2026 amid intensifying geopolitical and structural risks - argues Paul Chapman, HC Group's Managing Partner.
This article was originally published as part of HC Group's Annual Review 2025-2026. Access the full magazine here to read Paul's editorial - and more.
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Global Strains, Yet Apparent Resilience
2025 saw Iran and Israel go to war. The US bombed Iran, and Pakistan and India bombed each other. Tariffs whipsawed through the global economy, upending decades of free trade. The Green New Deal was strangled in its infancy, and the US took action in Venezuela. Chatbots have replaced the search engine and data centres are the talk of boardrooms around the world. A land war of Passchendaele-level grimdark continues in Europe.
And yet... energy prices have remained remarkably stable. The efficiency of liquid commodities markets has served us well - perhaps to the chagrin of energy trading desks (especially crude and natural gas) around the world. Refined products traders have been happier. So have power traders (those data centres again). Metals traders have been happiest of all – an auspicious start for those energy trading houses who have built-out metals desks these past couple of years.
Looking ahead, there are plenty of reasons to assume 2026 will be no different. But at HC Group, our suspicion is otherwise.
The Contours of 2026
Looking ahead, there are plenty of reasons to assume 2026 will be no different. Commodity markets enjoyed a genuinely strong spell from 2019 to early 2023. Since then, it has recalibrated - perhaps pointing to the next seven years being largely steady and, even, a bit boring. At HC, our suspicion is otherwise.
Firstly, the maxim “whatever doesn’t kill you makes you stronger” is tenuous. Typically, whatever damages you weakens you. And markets and institutions are being tested globally. Inflation stalks the land, and trade flows are being disrupted (by policies or wars). Technology, particularly AI, is already having a profound effect on people and participants. A comparable decade is the 1970s - incidentally, one of the most volatile periods for commodities on record.
In other words, it wouldn’t take much for energy prices, metals, shipping, etc., to go pretty haywire…again. And in such times, being able to solve for commodities in time, form, and location is very, very valuable. This is, of course, why strategics, producers, refiners, shippers, miners, consumers and even hedge funds have continued to invest in building physical commodity trading capabilities. Technology is breaking down structural barriers to entry, and COVID has smashed long-held board-level suspicions.
The Commodities Class of 92 is retiring, with only a few leaving bountiful successors and protégés behind them.
The Retirement Cliff Reshaping Commodity Talent
If there is one more source of volatility to add to this sea of unpriced risk, it is this: the Commodities Class of '92 (give or take) is retiring – retiring rich for the most part. But due to the vagaries of this sector, few leave bountiful successors and protégés behind them. The great retirement cliff is upon us, just as the commodities sector might be gearing up for its Second Act of the decade. Opportunities abound.