Warehousing and Storage

The tanks, silos, and vaults that turn surplus into carry trade profit and price signals.

Overview

Storage arbitrages time: buy now, store, sell later when the spread pays the cost. Cushing tanks define the WTI contract, and weekly inventory moves oil prices. LME warehouses hold metal under warrant, and load out queues, as in the Detroit aluminum episode, became scandal and rule reform when financing deals tied up stocks. Grain elevators store against receipts that finance bank lines, certified stocks back deliverable supply, and natural gas salt caverns set winter resilience while strategic reserves act as storage as policy. Storage fills in contango gluts and empties in backwardation squeezes, which is why inventory data is the physical fundamental every desk trades.