Commodity Management Blog

Innovative Ideas and Thought Leadership for Volatile Commodity Marketplace

A new trend is emerging in the manufacture of automobiles. Faced with fundamental changes in the metals, chemicals, plastics and energy market environment, global organizations have begun to look at energy companies and commodity houses and wonder whether they could benefit from the types of technology platforms deployed by these institutions.

For years, the world’s most successful energy companies and global commodity houses have relied on sophisticated commodity management platforms that enable them to proactively manage purchasing, demand/supply balancing and risk management of raw materials and financial derivatives. These systems also provide logistics tools, accounting and decision support that create…

I recently had the opportunity to sit down with New Zealand Mint’s Michael O’Kane to discuss his thoughts on the precious metals market, what keeps him up at night and how Triple Point has helped them expand their product offering.

Q: How does precious metals volatility today compare to the last few years?

Michael: During the financial crisis in 2008 we saw the price for gold jump by over $50 in an hour, which is generally unheard…

NFR Energy has licensed Triple Point’s Commodity XL™ software for hedge accounting and fair value disclosure to ensure FAS 133, FAS 157, and FAS 161 compliance.

NFR Energy engages in the acquisition, exploration, development, and production of oil and natural gas and has invested $1 billion in business development to establish a focused asset base.

“Triple Point has a proven track record of providing risk management software to E&P companies,” said Ash Elias, controller, NFR Energy. “We’re confident Triple Point is the best choice to deliver a turnkey solution that manages our hedge accounting requirements, including mark-to-market analysis, effectiveness…

Triple Point announced today the availability of Commodity XL for Dodd-Frank: End User Exemption™. The compliance solution is designed to ensure that organizations comply with Dodd-Frank rules for validating hedging programs in order to avoid central clearing and additional margin requirements.

Dodd-Frank will require that all OTC trades be centrally cleared but exempts companies that trade to mitigate their commercial risk. Commodity XL for Dodd-Frank: End User Exemption enables the exemption process for each hedge, allowing companies to protect their hedging programs and ensure that valuable working capital is retained.

Triple Point’s compliance solution manages the exemption process on a…

I am pleased to announce that recently Triple Point saw the fruition of its innovative credit research and development when our company was successfully granted US Patent #US007571138B2: “Method, System, and Program for Credit Risk Management Utilizing Credit Limits.”

Abstract: “Software aggregates and integrates credit exposure and credit data across accounting, trading, and operational systems within an organization and generates views of available credit in light of the exposure and credit limits.”

A comprehensive model of exposure to all counterparties, across all of their divisions and subsidiaries, is assembled, enabling the creation of a hierarchical view of each…

The United Nations issued a press release this week stating that the world population, which is close to 7 billion right now, will surpass 10 billion by 2100.  Many analysts had believed that population growth would stabilize at around 9 billion globally.

The news reminded me of an extremely interesting newsletter authored by Jeremy Grantham of GMO, titled “Time to Wake Up: Days of Abundant Resources and Falling Prices Are Over Forever.”

The main thesis of Mr. Grantham’s newsletter is that “the world is using up its natural resources at an alarming rate, and this has caused…

House of Representatives Bill, H.R. 87, introduced by Rep. Michele Bachmann, R-Minn. back in January, called for the full repeal of the Dodd-Frank Act (DFA).  As one would expect a repeal to be worded, the bill’s text simply states, “The Dodd-Frank Wall Street Reform and Consumer Protection Act (Public Law 111–203) is repealed and the provisions of law amended by such Act are revived or restored as if such Act had not been enacted.”

Oddly, even with Republican leadership in the House, the bill seemed to lack any serious momentum. There are, however, two nearly identical Senate bills, S. 712…

The sweeping Dodd-Frank Act changes in the US for market participant classification, clearing, and margining are being closely watched and emulated internationally.  The dangers/opportunities between national regulations, adoption, and timelines can be significant.

In September of last year, the European Commission proposed a framework to regulate OTC derivatives, central clearing counterparties, and trade repositories.  In December, the Commission also published a consultation paper on the Markets in Financial Instruments Directive (MiFID) to “improve the regulation, functioning and transparency of the financial and commodity markets to address excessive commodity price volatility.”  In a joint statement from EU Commissioner, Michel Barnier and CFTC Chairman,…

Can you mark all derivatives and perform all hedge accounting requirements for testing, documentation and reporting with only a few clicks? Are you confident you meet all FAS 133, 157 (ASC 815/ASC 820) and IFRS 7 requirements? Are you worried you might fail an audit because of hidden spreadsheet errors?

Triple Point recently hosted a webinar on Hedge Accounting Management and Fair Value Disclosures and how you can streamline your compliance efforts, gain control of operational risk and avoid financial restatements and other regulatory pitfalls. In case you missed the live webinar, here is a link to download the webinar and view…

“Thanks to the global financial meltdown, we now know what a “black swan” is,” writes Russ Banham in the April edition of CFO Magazine, “but do we know from which direction the next one will swim into view, and what to do when it does?” Black swan events are highly unpredictable, but it appears more and more companies are implementing ERM programs in hopes of being better prepared to identify and mitigate the impacts of the next one. What is causing this uptake? Is it really the fear of the next black swan event?

Possibly, but Banham shares 3…

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