Starting trading in physical commodities is actual a very tough job and you need very huge investment, for trading physical commodities you need lots of things like you need warehouse, transportation, you need to pay tax and insurance for warehouse or if you take warehouse in rent then you have to pay the rent. With the risks involved in physical commodities trading such as price and credit, one would question how you can make real money trading physical commodities. Supply and demand is the biggest thing a physical commodities trader has to worry about apart costs of transportation, storage, and set-up. Agree with some of the other answers e.g. provide liquidity and logistics. My list of the value add of the trade (let's say moving goods from a mine in South America or a cocoa farm in Africa to a manufacturer in the US): - Finds a seller when an