Commodity traders in agriculture companies face these 5 main business challenges:
- Cash management
- Risk/hedging effectiveness
- Operational/supply chain efficiencies
- Accurate & timely market intelligence
- Regulatory compliance
Limitations of traditional commodity management:
Using monolithic CTRM systems results in data-siloes with no real-time connection between procurement, logistics and commodity trading. Manually inputting data into spreadsheets takes a long time and often results in errors due to human mistakes. With spreadsheets you don’t get real-time insights which inhibit you from making on the spot decisions based on market changes.
Capabilities of modern CTRM:
Modern CTRM aggregates data from systems across the value chain including CTRM, ERP, accounting and spreadsheets. You can analyze the impact of dynamic market movements quickly, identify areas of opportunity or concern, and plan the next steps accordingly. It uses latest analytics tools, including AI and machine learning.
How modern CTRM benefits agriculture industry:
- Easier cash flow management – Using all available information about payments – both current and historical data – you can analyze payment history and behavior patterns to determine estimated payment dates. You can predict projected cash flow based on payment terms and analyze scenarios based on shipment start, middle, and end dates to evaluate various possibilities.
- Effective risk management – Analyze real-time data quickly to stay on top of risk drivers. You can set up alerts to take immediate action when risk limits are breached.
- Improve operational efficiency – With information available across the value chain, tracking of inventory at each location and maintaining the data becomes easier. You can match available time slots for expected deliveries to vehicle availability and reduce wait times and queues.
- Gain real-time marketing intelligence – Create notifications to alert you when market shifts occur. Having real-time data like weather forecasts from Accuweather and aWhere or market data from Refinitiv and S&P Platts, gives you an edge over the competition.
- Adhere to compliance – Automation makes it easy to comply to regulations of trade repositories. You can take prompt actions based on user defined alerts across geographies and asset classes.