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What is Commodity Brokerage?

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What is Commodity Brokerage?

You may have heard the phrase “commodity brokerage” or “material brokerage” before, but from the name alone it isn’t always clear what is involved. At Brown Recycling, we provide professional commodity brokerage, so we’re ideally placed to fill you in with more details.

 

What exactly is commodity brokerage?

Commodity brokerage is a system whereby companies with small amounts of waste can sell their bales to a commodity broker. The broker can then use multiple smaller amounts of a particular waste to be able to sell on the material in bulk.

The material itself can differ, from paper and cardboard to plastics. Accepting delivery of the bales of each particular kind of material, a broker can then collate the smaller amounts together to be sold on as a useful amount. The price the recycler gets for the commodity can help to finance their operations and keep recycling facilities operational.

The alternative to this involves the producer of the recyclable commodities scouting out the sale of their baled goods. This is a complicated process and could end up taking up more of their own time and resources, resulting in a loss rather than a gain.

 

What are the benefits of using a broker?

As mentioned above, the alternative to using a broker is to take the process on yourself – not something which can be easily done in a way that is profitable. There are, however, other benefits to using a broker to move on your recyclables.

Navigating the national and international markets is something a larger broker can do, while a smaller company simply may not have the contacts and resources required for such operations. Clearly, when seeking the best deal for recyclables, you want to have the best reach possible too, and knowing the most suitable buyers is going to be half the battle in fetching the best price.

Another reason a company may use a broker is because they simply have to. Smaller companies may not even get to put themselves in front of a buyer because of how small their operations and quantities are. A large company may not want to deal in such small quantities and therefore force the hand of the commodity seller. Using a broker avoids the confusion and ensures a company can sell their recyclables.

It’s all about striking a good deal for the party looking to sell their recyclable commodity. There is security in using a broker because you will know what price you can expect, rather than trying to sell directly and finding that the market price fluctuations confound the process.

What’s more, you won’t have to acquire the necessary licenses for dealing with your commodity – another time and money consuming chore for smaller companies.

 

Commodity Brokerage at Brown Recycling

Tailoring commodity brokerage to your waste type, you can rely on Brown Recycling to provide a cost-effective brokerage service. We us all our experience and industry knowledge you get you the best price for your material.

Whether you have plastics, paper or cardboard bales, we buy and sell from UK businesses and take the hassle off your hands.

Get in touch today if you’d like to learn more about commodity brokerage from Brown Recycling and our team will be happy to advise you.

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