the insider’s guide to managing agricultural commodity volatility with ctrm software &...

Managing Agricultural Commodity Volatility with CTRM Software & Advanced Analytics

Michael SchwartzEVP & Chief Marketing Officer,Eka Software

John WinnDirector – Solutions Consulting,Eka Software

The Insider’s Guide Webinar:

USA | India | United Kingdom | Australia | Canada | Singapore

Agenda

Introduction to Eka

• Background, Customers, Global Presence

Agriculture Commodity Markets

• Macro Trends

• Corporate Trends

• Industry Challenges

Required Solutions for Modern Ags Markets

• CTRM, Analytics, and Bulk Handling

Join the conversation:@EkaSoftware

#ekawebinar


Eka Software Solutions: Company Profile

Position: Global leader in on premise & cloud served Smart Commodity Management solutions

Founded: 2004

Employees: 315

Global Offices: 7 offices. 3 development & support centers

• Americas: Stamford CT, Calgary AB

• Asia Pacific: Bangalore India, Singapore, Adelaide & Perth AU

• Europe: London UK

Investors: Silver Lake Partners - GP Group - Nexus Venture Partners

Customer Base: >50 leading global enterprises on 4 continents• Cargill, Rio Tinto, Mitsui, Bunge, BMA, EDF Trading, Graincorp, Viterra, Louis Dreyfus, Noble,

CBH, Mitsubishi, Pinnacle Foods, Twin Eagle, Boliden, Tata Steel

Solution: InSight Commodity Management (CM) Platform• End to end financial and physical transaction management• Cross asset trading and position management – Ags, Energy, Metals, and Bulk• State of the art enterprise risk management

Commodity Analytics Cloud• Analytics specific to commodities• Multiple data sources internal and external to Eka• Prebuilt and custom apps

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Perth

Global Market – Global Customers – Global Engineering & Support

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Singapore

London

New York (CT)

Adelaide

Development & Support Centers

Bangalore

Eka Offices

Calgary


Eka Customers at a Glance

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Agriculture Metals & MiningEnergy

USA | India | United Kingdom | Australia | Canada | Singapore 6

Demand Growth

• Population growth• UN forecasts 33% world population growth by 2050

• From the current of 7.3 billion to 9.7 billion

• Middle class growth• 3 billion more people will join the middle class over the next 20 years -

almost exclusively from the emerging world

• Money spent on meat, fish, and dairy increases - non-protein staples such as cereals decrease

• “Luxury” items also changing - China overtakes France to become largest consumer of red wine - news from last year

Macro Trends in Agriculture


Supply Disruption

• Extreme weather events• Research by 220 climate scientists - extreme weather events such as

droughts, heat waves, hurricanes, and flooding have been increasing in length and intensity and are projected to continue to increase throughout the 21st century

• Devastating flooding in UK caused by the worst winter rainfall in the last 248 years

• Record drought in California leads to 62 trillion gallon water deficit in western states

• Worst El Nino in 30 Years Hits South American Crops

• Geopolitical risk – recent headlines• Germany: No More GMO Seeds – Aug 2015

• Thousands of Farmers March on Brussels as EU Proposes Aid – Sep 2015

• China Seeks to Calm Global Markets With Stable Yuan Forecast – Sep 2015

Macro Trends cont’d


• Global logistics complexity to drive market advantage – study by BVL International

• Rising customer expectations – service and cost• More channels and product variations• Expanding global footprint – markets and supply

• Mergers and acquisitions • Glencore considering selling stake in Ags operations (after acquiring Viterra in 2012)• Mitsubishi last month agreed to buy 20% of Olam• Cofco (China’s largest food company) last year acquired controlling stakes in Noble

and Nidera

• Explosion of data available for analysis - examples• Farm level - planting 2.0, understand the signatures from plants that signal how

much nitrogen, phosphorus, and potassium are required - Rajiv Khosla, professor of precision agriculture at Colorado State University

• IOT – sensors on all equipment such as stockyard operations• Weather data – Monsanto buys Climate Corp – goal sell more data to farmers

• Analytics, analytics, analytics• 68% of respondents rate senior management as committed to analytic/

fact-based decision making – Accenture Survey

Corporate Trends in Agriculture


1. Volatility is here to stay

So What Does it Mean?

2. Complex and integrated supply chains to manage

3. Systems that handle large data and support fast, smart decision making


• Multiple systems and spreadsheets to solve business issues• Transaction systems don’t cover end-to-end value chain

• Analytics (can) need input from multiple systems, external data, and spreadsheets

• Require more analytics and reporting from existing systems• Cubes for slice and dice – historical analysis

• Algorithm based analytics for competitive advantage – predictive analytics

• Analytics in the hands of business users – no longer domain of IT and specialists

• Generic BI tools require too much customization for commodity specific issues – dollars and time

• Better visualization to understand problems, opportunities, and solutions

• Need for mobility

What We Hear…


1990 2014+Mid-2000s CTRM Smart CM

FIRST- AND SECOND-GENERATION SYSTEMS NEXT-GENERATION SYSTEMS

ETRM

Transaction system necessary but not sufficient for today’s market

First- And Second- Generation Systems Not Built to Cross the Chasm

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• Transaction based• 10-15 year old technology• Cannot cross chasm to next generation

without rearchitecting (5-7 yr. process)• Multiple E/CTRM systems and spreadsheets

• Analytics + Transaction• Next-Gen architecture• Built for now and future• Aggregate and analyze data

across systems


John WinnDirector – Solutions Consulting, Eka

• 12+ years experience in commodity trading and risk management, including 5 years with Eka, in Ags, Metals, and Energy verticals

• Previously worked for leading companies across Europe, North America, and Australia including NYFIX, EDF Trading, Misys, and OpenLink

• Bachelor of Business and Bachelor of Information Technology from Queensland University of Technology, Master of Arts from University of Sydney

Industry Expert Speaker


• Single Platform for managing the entire Physical Workflow

InSight CM - Single Platform for Agricultural Commodity Trading

• Contracts• Logistics• Inventory• Settlements• Risk

• Global View of Position, P&L and Risk


• Different departments interact on the same data

• Removed redundant data silos

• Screens relevant to individual business functions with a real-world screen layout

InSight CM - Complete Physical Workflow


• Monitor risk across multiple dimensions• Apply risk policies across

different parts of the organization

• Determine which action caused risk limit breach

• Monitor exposure in real-time for hedging purposes

• Complex risk calculations• Value-At-Risk (VaR)

• Deltas & Greeks

• Option Valuations

InSight CM - Risk Management


• Exploratory data analysis

• Drag and drop reporting

• Graphical and tabular

• Ad-hoc queries to answer business questions

• Spot trends

Commodity Analytics Cloud - SmartCubes


• Strategic Data Analysis

• Commodity specific

• Algorithms

• Speed

• Process millions of data entities in seconds

• Self service

• Intuitive visualizations and app design enables everyone to use analytics

• Mobile

• Available on mobile devices including tablets and phones

• Data eco-system

• All the data required in one place

Commodity Analytics Cloud


• Supports strategic decision making

• Analyze multitude of data:• Suppliers

• Position

• P&L

• Cash Flow

Commodity Analytics Cloud


• Web and mobile based

• Site operations to help manage:• Truck tickets

• Inventory

• Quality

• Rail scheduling and movements

Commodity Site Manager (CSM) Solution


• Smart automation software for physical sites

• Automation control software for scheduling and interfacing directly with equipment

• Anti-collision for cranes

• Smart scales helps manage inbound trucks and trains

Smart Site Management


Questions?

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Michael SchwartzEVP & CMO

[email protected]

Webinar Recording:

http://info.ekaplus.com/insiders-guide-ags-ctrm-software-recorded-webinar

mailto:[email protected]

http://info.ekaplus.com/insiders-guide-ags-ctrm-software-recorded-webinar