Commodity price volatility not only threatens the survival of individual companies, but also puts entire markets and industries at risk. According to a PwC survey of leading manufacturers, 86 percent of senior executives said commodity price risk is important to a company's financial performance, adding that commodity risk was not managed well during the past two years.
Navigation: Managing commodity risk through market uncertainty, provides information on how clients can successfully navigate the current commodity market situation by embedding effective risk management throughout their organizations. In addition to price volatility, the report provides details on changing global trade patterns, geopolitical risk, counterparty and credit risk, and changing US commodity trading regulations.
Companies have tried—with varying levels of success—to apply margin management, procurement strategies, and hedging to manage commodity price risk. Unfortunately, there is no single solution; however, a robust and integrated approach that leverages multiple strategies and tactics across the business represents the greatest likelihood for success.