The worst of the liquidity squeeze on eurozone banks has eased conditions for commodities finance during 2012, but the business still faces significant challenges.

Tighter bank financing, falling government subsidies and rising US shale gas production are all putting the squeeze on the renewable energy industry.

Despite well-publicised retrenchment in commodities finance by some European banks, merchant trading companies are still able to find sources of funding expand their business lines.

With balance sheet clean-ups continuing in Europe and the US, banks in emerging markets have grabbed the opportunity to forge stronger relationships with local commodity producers.