what is the difference between gross processing margin and gross profit margin 
gross processing margin is the difference between a raw commodity and the price of its finished product when sold gross profit margin is the amount of money left over from product sales after subtracting the cost of goods sold cogs cogs can also be referred to as cost of sales and includes all of the costs and expenses directly related to the production of goods can gross processing margin be too high although gross processing margins fluctuate continuously a high gpm can be dangerous for both the business dealing with the commodity itself and the trader however large swings in gpm can be advantageous for strategic positioning especially when hedging long term positions the bottom linegross processing margin gpm is the margin resulting from the subtraction of the raw product s cost from the finished product s sale price this margin is in a constant state of flux due to the economic pressures of supply and demand this price action makes gpm an attractive play for certain traders who understand the commodities they are trading and how to benefit from the spread 