Agriculture

Large scale producers in Agribusiness have a problem in which their sale price is exposed to market forces while their input costs from land and equipment lease to land lease, to seeds and crop protection apparatus tend to be fixed. This exposure to the market can be hedged away using various financial instruments such as futures, options and swaps.

We work with clients in this area to develop hedging strategies, manage positions, value physical and financial contracts.

Processors deal with volatilities and market risk exposure both on the inputs and outputs sides of their business. The raw commodity (example: Corn) they require as inputs are often exchange traded and the products they make (Corn Meal) are priced against local publications and other forms of market price.

This operating environment requires that processors hedge exposure on both the input and output sides. We help develop and implement processes and systems to help manage various mission-critical operations including contract management, market risk and regulatory report, accounting, settlements, invoices among others.

We help silo owners and storage facility operators implement processes and systems that help track positions across commodities, varieties, customers, locations among other aggregation dimensions. In cases where storage operators take title or own replacement cost liabilities, we help track valuation of physical inventories, variety blends as well the hedge positions taken to mitigate market risk.

The Consumer Packaged Goods or Fast-Moving Consumer Goods industry is exposed to market volatilities that come from price movements in the commodities that go into the production of the goods they sell to consumers.

Price elasticity prevents CPG companies from passing along cost increases to consumers. This transforms procurement and strategic sourcing into a source of competitive advantage. We work with companies in this vertical industry to deploy processes and systems designed minimize the impact of market shocks on margins.