Commodity Trading & Treasury Integration. Karsten Kohl / BearingPoint Switzerland AG June 11/12, 2013. Content. Commodity Trading Market BearingPoint‘s Service Portfolio and Expertise Challenges for Commodity Management Systems Commodity Management in SAP.
Karsten Kohl / BearingPoint Switzerland AGJune 11/12, 2013
Mills & Mining
Oil & Gas
Our Service Portfolio in Commodity Trading
Physical and Paper Contract Management
Operations & Back Office
External Systems & sources
The synchronisation of front office physical and financial commodity trades with logistics, Treasury and Risk Management is essential to establish benefits for the business, to get advantages within the commodity traded market and to be able to track and trace the single positions.Commodity Trading ManagementThe requirements on a commodity trading system are highly complex.
The integration of commodity trading in SAP environment facilitates a seamless front-to-back office commodity management. Interfacing front office physical and financial commodity trades with SAP Logistics and SAP Treasury and Risk Management.
Commodity Management in SAPAn integrated solution is necessary to have the full transparency of each position as well as supporting the commodity trade lifecycle.
Financial Risk for Commodities (TRM)
Trading Contract (GTM)
Purchase Contract (MM)
Sale Contract (SD)
Trade Finance Credit Risk
Finance and Controlling (FI/CO)
Physical Trades (SAP)
Sales (SAP SD)
Purchases (SAP MM)
Planned data (SAP APO)
Other sources(e.g. Excel)
Web based analytic reporting allows easily to track and trace single positions, to turn axes, drill-down, to aggregate per free-definable criteria’s for example by type of commodity, type of trade, country, region, open position.
Aggregationof exposure positions(free definable)
Automatic built or uploaded from various sources
Automatically updated by in case of price and/or volume changes
A commodity SWAP can be with any counterparty in which:
(1) a fixed-price contract for a commodity is exchanged for its floating-price contract
(2) one commodity is exchanged for another, with an execution date (due date) at a future point in time (or multiple due dates).
Payer: A fixed price is paid and a floating price (index) is received (Future or OTC)
Receiver: A floating price (index) is paid and a fixed price is received
Basis: A basis SWAP involves swapping one floating rate index for another
Commodity Master Data is represented as commodity price curves.
The system supports two types of Curves:
•Future Style curves – For Listed Instruments and Published commodity prices on exchanges (opening price or closing price)
•Forward Style curves – For OTC Products
Assign the Futures Class to the Commodity Curve
Enter Commodity Forward Prices based on the price quotation style.
Subraw exposures can also split the commodity risk as well as the FX risk
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