Mid-Market Commodity Finance | FG Capital Advisors

Notice. FG Capital Advisors is a trade and capital advisory firm with a focus on carbon, commodities, and structured credit. The firm provides financial modelling, analytical support, and sponsor side advice around commodity finance, trade facilities, and related capital structures. FG Capital Advisors is not a bank, lender, credit insurer, broker dealer, or retail investment adviser and does not issue loans, guarantees, or insurance products. Any facility, guarantee, derivative, or investment is provided by regulated counterparties under their own licences and documentation. All potential transactions are subject to KYC and AML checks, sanctions screening, credit and investment committee decisions, independent legal and tax advice on the client side, and formal agreements with those regulated entities.

Mid-Market Commodity Finance

Mid-market commodity traders, producers, and distributors carry real volume and price risk while operating with balance sheets that sit below the largest global houses. Funding that risk requires lender comfort with inventory, receivables, and offtake flows, not only headline credit metrics.

FG Capital Advisors structures mid-market commodity finance around documented trade flows, storage and logistics arrangements, price risk management, and receivables quality, so that banks and private credit providers can underwrite facilities at meaningful size and tenor.

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What Mid-Market Commodity Finance Covers

Mid-market commodity finance sits between small transactional lines and large syndicated facilities. Structures are designed around identified supply, storage, and sales patterns, anchoring lenders on cash flows rather than unsecured balance sheet exposure.

  • Pre-import and pre-export funding linked to specific contracts, shipment schedules, and Incoterms, with repayment tied to receivables or offtake proceeds.
  • Inventory and warehouse finance where stock in tanks, silos, terminals, and bonded warehouses supports revolving borrowing capacity.
  • Receivables-backed facilities referencing approved buyers, documented payment terms, and historical collection performance.
  • Borrowing base and reserve based arrangements that combine receivables, inventory, and sometimes production to support lines sized to eligible collateral.
  • Working capital structures integrated with hedging and price risk management, so lenders can see how physical and paper positions fit together.

The objective is to align funding with the commodity cycle of purchase, storage, processing, transport, and sale, rather than rely on short dated, unsecured overdrafts.

Typical Structures For Mid-Market Traders And Producers

FG Capital Advisors works with a range of facility types that can be combined into a coherent commodity finance framework for mid-market clients. The appropriate mix depends on product, geography, and counterparty profile.

  • Pre-export and prepayment finance where lenders or offtakers advance against committed export flows, with security over contracts, receivables, and sometimes production.
  • Inventory and repo structures in which lenders or trading houses hold title or security over stock in storage, with clear control over tanks, warehouses, and release procedures.
  • Borrowing base facilities that blend receivables and inventory, applying eligibility criteria, concentration limits, and advance rates to define available funding on each reporting date.
  • Receivables purchase and discounting where approved buyer risk and documentary standards support funding against invoices and trade paper.
  • Structured trade and commodity lines built around letters of credit, guarantees, and risk participation, allowing banks and funds to share exposure while focusing on specific parts of the trade.

Facilities are arranged so that drawdowns, repayments, and covenants follow the operational reality of commodity flows rather than impose artificial constraints that disrupt trading.

Who Uses Mid-Market Commodity Finance And At What Scale

The focus is on mid-sized commodity actors that are too large for purely relationship-based overdrafts but below the size of global majors. These groups still face volatility in prices, freight, and working capital, and require lender frameworks that recognise real collateral and trade discipline.

  • Regional and specialist traders active in energy products, metals, agri commodities, or softs, often with recurring flows on specific routes or port hubs.
  • Producers and processors with sales portfolios split between traders, industrial buyers, and offtakers under medium term contracts.
  • Storage and logistics platforms that hold inventory on balance sheet and need financing aligned with throughput and utilisation.
  • Integrated mid-market groups combining production, processing, and trading, with exposure across several legs of the supply chain.
  • Sponsor-backed platforms acquiring assets and portfolios that need to demonstrate bankable working capital and commodity finance arrangements post-acquisition.

Typical target facilities range from upper single digit millions to the low hundreds of millions of dollars, often with the possibility of staged increases once performance is established.

How FG Capital Advisors Structures Commodity Finance Solutions

Engagements are built around actual trade patterns and risk management practices, not generic product menus. The analysis connects physical flows, documentation, and hedging so that lenders can test collateral and cash flows under realistic scenarios.

  • Mapping of supply chains, counterparties, Incoterms, storage arrangements, and logistics routes to identify where value and risk sit at each stage.
  • Quantitative review of turnover, margins, and working capital needs by product, corridor, and buyer segment, including seasonality and stress periods.
  • Design of facility structures, borrowing bases, eligibility criteria, advance rates, and covenant sets that reflect both operational needs and lender expectations.
  • Integration of price risk management, including exchange and OTC hedging, into funding proposals so lenders see how market risk is handled alongside credit and performance risk.
  • Preparation of information packs, financial models, and term sheet proposals for banks and private credit providers, working through regulated partners where transaction execution is involved.

The aim is to put forward commodity finance structures that survive credit committee scrutiny and still function in day-to-day trading conditions.

Information Typically Required For A Meaningful Review

To provide a grounded view on mid-market commodity finance options, a clear picture of current operations and funding is required. As a guide, initial reviews usually rely on the following:

  • Recent audited financial statements and management accounts for key operating entities in the group.
  • Breakdown of trade flows by product, route, counterparty, and Incoterm, including typical volumes, margins, and tenor of receivables and payables.
  • Details of storage, warehouse, and terminal arrangements, including control, title, and inspection regimes.
  • Information on hedging policies, instruments used, and how physical and paper positions are monitored.
  • Summary of existing banking and private credit facilities, including limits, security, covenants, and utilisation patterns.

Where data is incomplete, FG Capital Advisors can still indicate likely structures and constraints, but views on size and pricing remain indicative until information quality improves.

Mid-market commodity platforms that plan to grow volumes, extend sourcing and sales portfolios, or acquire assets need working capital and commodity finance frameworks that can scale with those plans.

A concise overview of products, routes, counterparties, storage set-up, and current facilities is enough for an initial assessment of suitable commodity finance structures and potential funding channels with FG Capital Advisors involved on the advisory side.

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Disclosure. FG Capital Advisors provides financial modelling, analytical, and advisory services. The firm does not originate, offer, or sell securities, loans, deposits, guarantees, or insurance products and does not accept client money. Any commodity finance facility, trade line, guarantee, derivative, or investment product referenced on this page is carried out by regulated entities under their own licences, terms, and documentation. Commodity finance and related structures involve credit, performance, operational, legal, market, and policy risk. Nothing on this page is a recommendation or a solicitation to enter into any transaction or to buy or sell any financial product. Any engagement with FG Capital Advisors is subject to internal approval, conflict checks, KYC and AML checks and sanctions screening where required, and the terms of a formal engagement letter.