At the DACT Treasury Fair 2018 KYOS hosted a workshop together with Cargill. DACT (Dutch Association of Corporate Treasurers) held this annual event now for the 16th time. Apart from three rounds of workshops, participants could also visit product demonstrations and walk along the exhibitor’s stands.
Founded in 1865 by William Wallace Cargill in Minnesota, USA who owned a grain warehouse. More than 150 year later, Cargill still has its head quarters there but now employs over 155,000 employees in 70 countries offering a wide array of goods and services. The company’s activities include importing, trading and processing grains and oilseeds; manufacturing animal food, and creating ingredients such as sugar and cocoa for the food and beverage industry. Financial risk management of commodity exposures is of vital importance at this still family-owned business.
Tom Schurmans provided some insights into some of the daily activities at Cargill, particularly on energy costs and risks. Cargill uses the KYOS’ Commodity Portfolio & Risk Management System. Together with Richard Cornielje he showed how Cargill employs the KYOS Portfolio and Risk Management (PRM) system in practice to manage exposures, physical flows, financial derivatives and residual risks. In addition, Richard gave a practical example of how a commodity portfolio and risk management system is essential for clarifying risks and calculating potential distribution of cash-flows. The case study of the imaginary Energize Drink BV showed that having a good understanding of your cash-flow risks is crucial. With these insights, Procurement and Treasury are then able to select and execute the optimal hedging strategy.
To view the presentation slides: DACT Treasury Fair 2018 Presentation
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