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EDIT: Although I will say that it feels weird that after you finish the starter guide, none of the tasks actually have anything to do with the town. I like that they use stuff from the actual game, but it would make more sense to me if each task had 1 thing you had to do from the rest of the game, and one thing you had to do from the town.
The trader will allow you to trade in your main resources to add to the township generic resources at a certain ratio and withdraw from township to your main resources at a less favorable ratio.
For instance the potions you can withdraw are all Tier 4 potions. So it's a way of getting Tier 4 potions without even having done any work in herblore.
Similarly food can be cooked food, various herbs, lumber and planks are logs.
It's essentially passive resource generation. You can build your township to focus more on one resource or another and then withdraw from it every 8 hours.
EDIT: Actually it's less than 8 hours. I'll try to see what the interval between Traders actually is.
It's 7 hours in between traders with the trader being up for 1 hour. Mine just left and there's 84 ticks until they're back.
Oh that's possible. No clue since I use the herb potions that can generate T4 potions.