By implementing risk management process, companies can minimize the negative impact of the market challenges. Every company that is exposed in their day-to day business to volatile commodity markets faces several challenges. Due to dramatic price level changes induced by “Black Swan” event (2008 Global Financial Crisis) as well as large financial shifts (e.g. China metal demand boom, Global climate change affecting crops) forces firms to better manage their risks. The increasing cost pressures lead firms to focus on active cost as well as margin management, while increased competitive pressure drive commodities players to bring their game to a new level of sophistication. Formerly supply minded firms will now have to value and manage complex optionality in an increased regulatory and reporting environment (Basel III, EMIR etc.) to control their risk.
We at CForsa believe that with the services we offer, we can create value for our clients participating in volatile Commodity markets: Our integrated advisory approach addresses all layers of change – from the governance level through risk management processes, using optimization and hedging programs and being active in the market using financial instruments, down to the effective embedding of quantitative IT-solutions.