Doing the sugar shuffle - FT.com After his shock departure at the end of 2011, the re-emergence of Jonathan Drake, Cargill's former head of sugar trading, had created a bit of a frisson in the market. The well respected Mr Drake, who built the leading agriculture commodities trading house into a leading player in sugar, is joining physical trader RCMA Commodities, founded by Cargill alumni Doug King, Michael Coleman and Chris Pardey. With the title of chief operating officer, Mr Drake will help diversify RCMA, based in Singapore, as well as overseeing a move into white sugar trading. All eyes are on how long it will take him to bring RCMA on to the larger raw sugar market, his old stamping ground. Not that the raw sugar arena lacks new participants. Over the past years the market - traditionally dominated by large commodities trading houses US-based Cargill, ED&F Man of the UK, Groupe Sucres et Denrées of France and Swiss-based Louis Dreyfus Commodities - has attracted a large number of new players. The arrival of new players comes after long dull years. During the 1990s and early 2000s, prices were stable trading around 9-10 cents a pound, compared with a peak of 34.10 cents last year. "Sugar was boring and cheap," says Robin Shaw, an industry veteran and analyst at London-based brokers Marex Spectron. The spicing up of the sugar market comes on the back of Brazil, the world's largest producer and exporter of the sweet stuff. Brasilia decided to use some of its sugar cane output to produce ethanol, triggering in 2006 the first serious rally in sugar prices the market had witnessed since the big price spikes of 1974-75 and 1980-81. The surge in prices enticed new entrants. Companies moved into production, by buying physical assets such as mills, as well as creating trading operations. With the added factors of bad weather and increased demand from emerging economies came volatility, making the sugar market also attractive for financial speculators. ADM and Bunge, the two other "ABCD" commodities trading houses (C being Cargill and Louis Dreyfus the D) entered the fray, while the Asian commodities houses "NOW" - Noble, Olam and Wilmar - have also expanded into sugar. Other traders included London-based cocoa and coffee house Armajaro Trading. Sugar producers joined the fray: Copersucar, the Brazilian millers co-operative, and Australia's Queensland Sugar also started to trade their produce. New participants meant the movement of teams and people. Bunge bought Tate & Lyle's sugar trading arm in 2008, while Guy Toller, formerly at London-based sugar merchant Czarnikow, moved to head Armajaro's sugar operations and Wilmar hired Jean-Luc Bohbot, former head of trading of Sucres et Denrées. Has the sugar industry become too crowded all of a sudden? Although vertical integration is now the name of the game in the commodities trading business, some financiers are wondering how many of the players will retain their assets in the sugar market for the long term. The bet on Brazilian ethanol has so far backfired. The other question is in the trading patterns on the futures market and how long trading houses will stick to what is now considered the conventional model, where a large company uses its financial power and balance sheet to leverage up on a customer order and take a large position. It takes up a very large capital base, and as one sugar trader puts it, more clients seem "bored of being on the wrong end of a squeeze."