LONDON • As Glencore's stock went into free fall in August in the face of heavy debts and shrinking earnings, its chief, Mr Ivan Glasenberg, had a defiant message - traders can beat weak commodity prices during market downturns.

But while analysts and investors were trying to figure out how trading could save a company in crisis, several traders were leaving the firm after what sources said were trades that failed to reward the big risks taken.

The departures of Mr Edmund Lau and Mr Tay Meng Yee from Glencore's fuel oil desk in Singapore in August and this month's departure of the global head of fuel oil, London-based Yannick Fedele, came after Glencore bet big in the world's top fuel oil and ship refuelling market in Singapore.

Mr Glasenberg's model was based on expanding the huge merchant of oil, coal, metals and grains into production by borrowing over US$30 billion (S$42.9 million) to buy coal and copper mines.

The idea was simple: In commodity price booms, coal and copper generate huge returns. In downturns, trading would pay the bills as it thrives on market volatility.

As mining normally generates three-quarters of Glencore's earnings, trading was mostly ignored by the market after Glencore's record US$10 billion share placement in 2011. But as commodities began sliding last year, trading came under the spotlight.

"Trading is often similar to betting. Glencore has done it well for decades and they have one of the most talented teams. But to actually guarantee certain performance for trading is a bit brave," said a top executive at a rival.

Glencore market jitters focus on a straightforward dilemma: Will it earn enough to service its debt when China is cutting its use of coal and copper?

The stock tanked 29 per cent on Monday but has since clawed back most of the losses.

BLOOMBERG