The influx of global firms comes as the sector undergoes consolidation following a series of insolvencies and judicial recovery proceedings among local traders. Industry participants and regulators are evaluating measures to strengthen market security, including collateral requirements and the development of an exchange-traded electricity market.
Denmark's Danske Commodities, part of Equinor EQNR.OL, entered the Brazilian market in 2023 and spent the following years securing regulatory approvals and assessing opportunities and risks before stepping up its activities this year, said Felipe Gatti, the trader's newly appointed head in Brazil.
Executives said the changes are likely to accelerate consolidation, concentrating trading activity among a smaller number of financially stronger counterparties.
StoneX, Macquarie and Trafigura build presence
StoneX SNEX.O has established its first global electricity trading desk in Brazil, targeting synergies with agribusiness clients and power producers, said Marcelo Mello, the company's local head of the segment. While awaiting greater clarity on geopolitical risks and the domestic trading sector's turmoil before launching trading operations, StoneX has already begun offering risk-management services to energy companies.
Australia's Macquarie MQG.AX has also stepped up its push into the Brazilian power market since last year, according to sources familiar with the matter. The bank said it sees opportunities to help clients manage price risks, secure financing and structure complex transactions.
Trafigura, which announced its entry into Brazil's power market in June, said the country's hydroelectric-heavy generation mix complements its energy portfolio in the United States and Europe and offers significant trading opportunities.
Global firms move into Brazil electricity trading
Global commodities traders and financial firms, including Trafigura, StoneX and Macquarie, are expanding into Brazil's electricity trading market, betting on rising price volatility and the sector's long-term growth even as a wave of financial distress hits local players, executives told Reuters.
The moves come as several small and mid-sized Brazilian power traders face financial difficulties, creating an opening for well-capitalized international groups to gain market share in one of the world's largest electricity markets.
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