Nick Hungate joined RCMA Commodities Asia Pte Ltd. as global head of cotton today as the Singapore-based firm expands agricultural trading.
Hungate, previously director of farm commodities at Deutsche Bank AG (DBK) in London, will lead a team of five, Chief Executive Officer Chris Pardey said in an interview. Hungate started his career at Cargill Inc. in 1985 on the same day as Pardey, both said. He will continue to be based in London.
RCMA, majority-owned by hedge-fund managers Doug King and Michael Coleman, has increased headcount 80 percent to 120 since end-2010. Merchants such as Vitol Group, the largest independent oil trader, are moving into agriculture as investment banks cut commodity staff amid declining revenues and stricter regulation. Cotton is the second-best performer this year on the Standard & Poor’s GSCI Index of 24 raw materials.
“We see cotton as a growing market,” Hungate, 49, said in an interview on May 21. “Demand at the moment is quite good. Almost all the mills in the major consuming countries, from Indonesia to Bangladesh, they all need to buy as they ran down their stockpiles.”
Global consumption increased 10 percent in the past decade, according to the U.S. Department of Agriculture, as rising incomes boosted sales of clothes. While inventories are seen by the USDA surging to a record 92.7 million bales in 2013-2014, 63 percent is stored in China, the largest user, leaving less supply for textile makers in countries including Bangladesh. Each bale weighs 480 pounds, or 218 kilograms.
Hungate joined Deutsche Bank in London in 2010 and was formerly executive director at Rabobank International.
RCMA Commodities expanded into sugar last year after hiring ex-Cargill trader Jonathan Drake to lead that team. The firm expects to handle 400,000 metric tons of rubber this year, 300,000 tons of sugar and 60,000 tons of coffee, Pardey said.
Phil Munden, last with Nestle SA (NESN) as coffee procurement manager for Europe, will start at RCMA as arabica coffee head in London on June 3, Pardey and Munden said.
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