Trafigura lost $577 million buying nickel cargoes that were actually carbon steel

Trafigura Group is one of the world's largest commodity trading companies, moving millions of tonnes of oil, metals, and minerals across the globe. In 2022, it purchased several large cargoes of nickel from a seller named Prateek Gupta. The shipments were supposed to contain high-grade nickel worth hundreds of millions of dollars.

Trafigura's trading desk became suspicious when the cargoes took longer than expected to reach their destinations, made extra port calls, and the seller delayed providing documentation. When Trafigura investigators physically inspected the shipments in Rotterdam in December 2022, they found the containers held carbon steel and other low-value materials instead of nickel. The company reported a $577 million loss in February 2023.

The London High Court ruled in January 2026 that Trafigura was the victim of a fraud orchestrated by Prateek Gupta, awarding $500 million in relief. The court increased the damages to $700 million the following month. Two Trafigura employees — including the head of nickel trading — were cleared of any wrongdoing. The case became a landmark example of how commodity traders can be deceived by fraudulent documentation when physical cargoes are not verified.

They trusted seller documentation over physical inspection, so fake cargoes passed checks until Rotterdam inspection exposed the fraud, leading to a $700 million award.

Trafigura relied on seller documentation rather than independent physical inspection of cargoes before payment.

The fraudulent shipments followed normal trading patterns initially — the substitution was sophisticated enough to evade commercial checks.

Commodity markets operate on trust and speed, and the pressure to close deals quickly can override verification procedures.

The fraud exploited a gap in the nickel market: supply chain verification was not keeping pace with the complexity of global shipping.

In commodity trading, the document is not the cargo — and a company that pays for paper instead of metal is not trading, it is gambling on the honesty of strangers.