There are so many small parts of the machine that keep the world spinning on its axis, that get us from point A to Point B—things that we don’t give a second thought to. Rice is just one of many such commodities, including wheat, barley, and coal, that we often take for granted.
How do they get to other countries? Places that don’t have the good fortune of a homegrown supply?
Rakesh Sodhia, Managing Director and Owner of Fortuna International Ltd., has been in the business of trading these commodities for 40 years. Born and brought up in Delhi, after completing a postgraduate course of study in international trade from the Indian Institute of Foreign Trade, he moved to Bangkok in the early 1980s.
Masala had the chance to speak with the virtuoso trader about his journey.
How did you happen upon rice trading?
Hah! This is a question that is asked by most people who meet me. 1982 brought me to Bangkok, where I joined G.P. Group, an agricultural commodities trading firm owned by Mr. Kirit Shah.
I was handed the rice portfolio on day one and was told, “You are responsible for rice.” I started as a marketing executive and ended as the managing director of the trading arm of G.P. Group’s Bangkok office. Neither was I asked to move to another commodity, nor was I keen to shift anywhere else.
I learned a lot about how to do business and how not to do business in the 18 years I spent with the G.P. Group, and of course, I must give full credit to my boss for his guidance and support throughout the time that I worked with him. He was a very good judge of character.
He realised early on that rice was in good hands, that I was not going to buy or sell like crazy.
After 18 years with G.P. Group, I was looking for a change. With a few colleagues, I started a company called Phoenix Commodities Trading in Bangkok to continue trading rice. I was with Phoenix Commodities for approximately 10 years.
Even in the first 30 years of my career here, I always took time off for my family and for sports, including cricket, tennis, and golf, but in 2009, I slowly came to the realisation that I wanted more time for myself, to be able to create and dictate my own schedule.
Thus, I sold my shares in Phoenix Commodities and started my own company called Fortuna International Ltd. I work but also play, and count myself fortunate to have the wherewithal to make the switch from a full-time career to a part-time career in order to enjoy my leisure time.
Having been in the business for so long, what sort of impact has commodities trading had on you?
I am, relatively, an introvert by nature, which is the total antithesis of what a trader represents. As a trader, I had no option other than to go out and meet people, listen, and talk to them. That helped me.
My work has taken me to many difficult places and countries. Many of the markets I dealt with through G.P. Group included Somalia, Somaliland, Djibouti, Rwanda, etc. I went to these places that needed rice and met some really nice people. The experience helped me open up to a certain extent.
I think commodity trading teaches one patience, equitability, and integrity. Integrity in what you say and what you do. Whether it is business or personal, I definitely think that is one of the most important aspects I have kept with me.
Do you have any anecdotes from your early years of work?
[Hearty laugh.] That could take all day.
Some of my best trading experiences have been in Somaliland. It is the northern part of Somalia, which was once under British rule.
Picture this. I am flying from Hargeisa, the capital of Somaliland, to Berbera, which is Somaliland’s port. It was a small, very old, 10-seater plane.
There’s a man in a white shirt and white pants who is walking around the plane as it’s being refuelled—cigarette in hand. I tell my friend, “Who is this guy? He’s smoking!” My friend waves me off. “He’s the pilot,” he says.
On the plane, our luggage is stacked right between us and the cockpit, with a tin mesh covering holding it upright.
As we’re about to take off, the captain announces: “Will the guys in the front row please stand up and hold the luggage because there is a danger of the luggage falling down as we go up.”
Even when I came back and told my colleagues in G.P. Group about these incidents, they wouldn’t believe me!
In trade, plans can often fall by the wayside. How do you overcome these roadblocks when they arise?
Yes, it is common. You set up a trade, and either the buyer or the seller will default. All of this is part and parcel of the trading business.
During my time at Phoenix Commodities, we had sellers in Vietnam, and the market price of rice went up. Now we’d bought the rice; we’d even sold the rice. Suddenly, the seller said, “No, I’m sorry. I cannot give it to you.”
This is where relationships in trading come into effect. So, I flew to the supplier’s office in Ho Chi Minh and sat down with the boss of the company. I looked him in the eye and told him we had already sold the rice and would not be able to give him the new market price, but I was willing to negotiate.
He appreciated the fact that I went over to sit with him and was frank in my dealings. Even though we made very little money in that deal, that man became a supplier for life.
In trading, there is a give-and-take. You cannot say, “Let’s go for arbitration.” It doesn’t work. Personally, I have always looked at the long-term picture, rather than short-term gains.
In today’s automated AI-driven supply chains, how do you think traders can keep the human aspect of trading alive?
Rice, as a commodity, is different from any other agricultural commodity. It is what I call a purely physical commodity. Rice goes directly onto the plate of the consumer.
There is no futures exchange, no hedging mechanism. As far as AI is concerned, what can it do? It can’t build my relationship with my buyers or my sellers.
Going back to my time trading in Somaliland, one of my buyers was probably the most powerful businessman in Somaliland. Great guy! Couldn’t speak a word of English, nor could I in Arabic, but we seemed to get along.
I don’t know how it happened, but he had developed a tremendous trust in me. So, when he was unwell, he told his son, “Whatever you do, you buy rice only from Rakesh.”
That came out of the blue to me and I was so touched by it. This just illustrated the necessity of relationships in trading. Rice trade will remain personality-driven, relationship-driven, and AI cannot help me in what I believe to be the most important component of trading.
Outside of work, how do you spend your time?
My passion for the last 20 years has been golf, and I am lucky to have a band of golfers. It is a good bunch of people who play regularly.
I mark Tuesdays and Thursdays as golf days to allow others to schedule their work, if they have any, accordingly, and join the games. Friday is reserved for the Rotary Club.
When I was thinking of giving back to society in whichever way, I looked at several organisations and found the Rotary to be the best. If I donate THB 1,000 to the Rotary, I want to see that money, in its entirety, go into a project. That was a major factor for me.
Weekends are more relaxed. Since both my son and daughter live in Bangkok, and I have two grandchildren, we enjoy spending time with them. We make it a point to meet up for a meal together on the weekend.
What advice would you give to young entrepreneurs and traders today?
Understand your commodity. Be fair in your relationships. I cannot stress that enough.
Although it is a tightrope, be fair to both buyers and sellers. You have to strike a good balance so both parties feel as though they have received a fair deal.
As a trader, there are times when you will feel as though you can make an extra sum of money by squeezing or shaking down certain people. It doesn’t work in the long run.
I’m not saying to give away money, but rather to remain fair in your dealings. That is the ultimate aim.