Citigroup, Inc. plans to expand and increase its commodities team in Asia by 40% next year to target double revenue from the business and in bidding to capitalize on a rising demand of raw materials eventhough the recovery of global economy in boosting metals and energy.

Thomas Maheras, head of the Citigroup, Inc.’s global capital market division, said in a conference call last month pertaining to the US bank’s growth plans to investors, “We have not attained a top-tier position in the fastest growing products partly due to lack of investments and we are shifting the mix to attach these gaps.”

Maheras said that commodities and structured credit were the growth areas for the corporate and investment bank. He said that commodities revenues, had grown from nothing in 2004 to $135 million, and the bank aimed now to double as it increased its staff by at least 40% next year. Citigroup also started oil and metals trading and opened already a trading operation in Calgary and the bank is planning now to expand in London and Singapore.

Now Citibank, which has 22 commodity staff in Asia are now planning to focus on new products in coal, gas, freight and emissions. As the regional head of commodities, Ananth Doraswamy said in an interview from Singapore, “Because everybody is expanding in commodities, you want new blood.”

Apparently, the Citigroup already hired a director in commodities marketing and origination in Asia namely Ted Huang. Huang, who joined from JPMorgan Chase & Co., will now focus on energy derivatives and commodities.

Asia will be the biggest contributors to growth in commodity consumption,  Doraswamy said on Aug. 28. “We will need more people in energy trading and metal sales, as well as agricultural products.”

Citigroup, the third-largest bank after Bank of America Corp. and JPMorgan Chase, has about 300 commodity staff globally, 10 times more than four years ago, said Doraswamy, who moved to Singapore in 2005 after 10 years with the bank’s interest rate derivatives group in New York.

Meanwhile, Citigroup reported second-quarter profit of $4.28 billion, less than analysts estimated, as loan losses cut into a gain from selling control of the Smith Barney brokerage unit. That compared with a loss of $2.5 billion a year ago.

Citigroup has already closed its defined benefit pension fund for 150,000 US employees ahead of an upcoming requirement that pension obligations must be account for on the bank’s balance sheet from the end of December.

Doraswamy also reported that China almost double its consumption of oil in the past 10 years and same with a big demand in India and Korea. And according to the regional head, the usage trends will still be continue as China now dominates the use of industrial metals.