In the latest episode of the Strong Source Commodity Podcast, we had the privilege of sitting down with Ivo Sarjanovic, a well-respected figure in the commodities industry. With over 35 years of experience spanning roles from trader to CEO, Ivo offers a wealth of knowledge, making this episode a treasure trove of insights for both seasoned professionals and those just beginning their journey in commodities.
A Journey Through Commodities: From Argentina to Global Markets
Ivo’s career began in Argentina, working at the Bolsa de Comercio de Rosario, where he initially focused on market analysis. “I realized that only the analytical part was probably a bit boring for me. I wanted to see some action,” Ivo explained, reflecting on his decision to join Cargill in 1989. This move set the stage for a remarkable career that took him around the world, from trading wheat and soybeans in Geneva to leading the sugar business and managing the Middle East and Africa for Cargill.
Despite the many roles he’s held, Ivo’s passion for teaching and sharing his knowledge has remained constant. “Since 2017, I divide my life into three things: being a non-executive director, teaching at universities, and being part of investment committees for ag-tech funds,” he shared. This balance allows him to stay connected to the industry while nurturing the next generation of commodity professionals.
The Thrill of Trading: Best and Worst Trades
When asked about his most memorable trades, Ivo didn’t hesitate to share both the highs and the lows. One of his best trades involved playing against an inverse in the soybean market in 1997. “The U.S. was running out of soybeans, and the market was heavily inverted. We brought soybeans from Brazil to the U.S., and the day we announced it, the inverse collapsed. It was an amazing feeling,” Ivo recalled.
However, not all trades end in victory. Ivo shared the story of the “Red Soybean Crisis” in 2004, where tainted soybeans caused widespread defaults in China. “At first, I thought it was only happening to us, but soon realized it was an industry-wide issue. It was a very expensive lesson, but also a very good one,” he noted. This experience taught him the importance of managerial support during crises, a lesson he carries with him to this day.
Key Lessons for Aspiring Traders: Avoid Dogmatism
For those new to the industry, Ivo’s advice is clear: avoid dogmatism. “The key to being a good trader is not to be dogmatic. You need to learn to be self-critical and not use facts to confirm your biases,” Ivo emphasized. He draws inspiration from philosopher Karl Popper, advocating for a mindset of critical rationalism and constant learning.
In addition to maintaining an open mind, Ivo highlights the importance of diversity and teamwork in trading. “A good team is crucial for success. You need a diverse pool of traders who can challenge each other and bring different perspectives to the table,” he explained. This diversity, both in thought and background, is what makes teams stronger and more resilient in the fast-paced world of commodities.
The Art of Balancing Confidence and Flexibility
One of the recurring themes in our conversation was the delicate balance between confidence and flexibility. “The market will constantly tell you not to be dogmatic. You have to balance between being open-minded and having confidence in your fundamental analysis,” Ivo said. This balance is essential for traders, who must navigate the fine line between sticking to their convictions and being adaptable enough to change course when new information arises.
Ivo also touched on the challenges of transitioning between different commodities and the importance of continuous learning. “I would recommend changing commodities at least once in your career. It keeps you alive and active, and brings fresh perspectives to new markets,” he advised.
Commodity Trading in the Modern Era: A Focus on Macro, Biofuels, and Demography
As we discussed the current state of the industry, Ivo highlighted three key areas of interest: the impact of macroeconomic factors on markets, the influence of biofuels on price formation, and the implications of changing demographics. “I think we fundamental traders tend to focus too much on microeconomics and miss the impact of macro issues,” Ivo noted. He also expressed concern that global population growth may slow more than expected, potentially leading to significant shifts in commodity demand.
Demystifying Commodities: The Role of Education and Knowledge Sharing
Throughout his career, Ivo has been a strong advocate for education and knowledge sharing in the commodities industry. His recent book, co-authored with Alan, seeks to demystify the world of commodities and challenge common misconceptions. “The book is a word of praise for prudency and caution. It’s about understanding that commodities are not a passive investment—timing is everything,” Ivo explained.
In closing, Ivo reflected on the importance of sharing knowledge and educating the next generation of traders. “The industry needs people who are willing to share their knowledge. It’s not a transparent industry, so we should be glad for those who are willing to educate,” he said, echoing the mission of our podcast to bring more transparency and understanding to the world of commodities.
Conclusion: A Lifetime of Learning in Commodities
Ivo Sarjanovic’s career is a testament to the rich and complex world of commodities. His journey from Argentina to the global stage, coupled with his dedication to education and mentorship, offers invaluable lessons for anyone interested in this field. Whether you’re a seasoned trader or just starting out, Ivo’s insights on avoiding dogmatism, balancing confidence with flexibility, and the importance of continuous learning are sure to resonate.
As we wrapped up our conversation, it was clear that Ivo’s passion for the industry remains as strong as ever. His commitment to sharing his knowledge and helping others navigate the complexities of commodities is truly inspiring, and we look forward to continuing these important conversations in future episodes.
Listen to the full episode to hear more about Ivo’s journey and his insights into the world of commodities trading:
What is the Strong Source Podcast?
Our mission with the Strong Source podcast is to educate and inform, by creating a community where experts and guests from the entire commodity industry can share their unique perspectives. Martijn Bron, ex-cacao trader, and Alexander Sterk, ex-dairy trader and founder of Vesper, have a deep-passion for this industry, which inspired
