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In 2021, Commodity Technology Advisory LLC (ComTech) published its first Disruptive Technologies research report (that version kindly sponsored by FIS). Technologies covered in the study scope included cloud/SaaS, Artificial Intelligence (AI), Machine Learning (ML), big data, automation and blockchain, amongst others. The findings were supported by an industry survey that led to the broad conclusions that cloud/SaaS and data management initiatives were in flight. AI, ML and automation seemed to be prepping for an explosion of use while blockchain was overhyped and lagging. Over the last couple of years, our general market observations as analysts have largely confirmed the results of the research.

In early 2021, ComTech decided that the whole topic was worthy of a revisit as a result of many changes and trends in the industry and so began a new project. This report is the result of those efforts, and it was kindly sponsored by Invensoft, Kyos, and Commodities People.

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In all of its forms, risk management is rapidly growing in importance within the commodity asset class. It will only become even more critical and complex in the future. Driven by unprecedented levels of change in the industry ranging from geopolitics to carbon, effective risk management is shifting for many commodity firms from just another activity to be managed to a critical component of business strategy that helps drive and inform brand, gain financing and trust, and demonstrates proper controls.

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ETRM systems are, by their nature, complex software products as the software must mirror the full complexity of the commodities industries, markets, and assets that they serve. Spanning from contract administration through invoicing and settlement, the business processes involved in commodity trading varies greatly. This variation is created by the unique combinations and nature of the physical or financial commodity or commodities traded, as well as by the industry segment (power generation/trading, gas production/trading, agricultural production/trading, etc.), the assets employed in the supply chain(s) and geographic differences (North American power vs. European vs. Japan, for example).

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2021 Trends in Agricultural and Soft Commodities Trading

Arguably, all commodity and commodity-exposed businesses are facing unprecedented change and disruption. These numerous challenges range from climate and carbon to COVID lockdowns and work from home, to managing geopolitical and operational risks through supply chains while seeking to digitalise, automate and increase efficiencies across the business.

While talk of a new commodities supercycle may be premature, global population growth and the resulting increased demand suggest rising prices and volatilities, especially in agricultural commodities. Companies need enhanced agility in such markets. It starts with a modern software platform that provides adequate visibility and control over the business, from managing physical movements to limiting risks and exposure. https://www.ctrmcenter.com/publications/white-papers/2021-trends-in-agricultural-and-soft-commodities-trading/

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As energy companies seek to become more efficient and agile in a rapidly changing marketplace fraught with risks, digitalization - the process of evolving from manual or analog processes to more efficient and cost effective digital processes by reducing the number of times data is touched and ensuring greater accuracy and more rapid movement of data and information throughout the enterprise – continues to attract attention from CIOs across the energy value chain.

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For most raw materials and commodities, the supply chain is both long and complex. Increasingly, firms have been focusing on these supply chains in an effort to better control operational risks and exposures, but increased geopolitical and other risks have now served to sharpened that focus even further.

Issues like COVID-19 lockdowns and trade wars, for example, have meant that managing sourcing, movements, processing, production, procurement, contracts, storage and other activities along complex supply chains more effectively not only reduces costs and improves profitability, but also helps ensure business continuity. Meanwhile, although CTRM (Commodity Trading and Risk Management) sof tware applications that help manage trades and the risks associated with trading are seen as critical, the broader commodity management aspects around managing the supply chain more effectively are rightly gaining in importance.

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2020 CTRM Vendor Perception Survey and Analysis

The 2020 Commodity Technology Advisory’s Vendor Perception Study is a biennial survey and analysis conducted to establish end-user and market influencer perceptions of the CTRM vendors, and to determine market leadership perceptions as well as buying criteria and brand awareness of the different vendors. As in previous years, the research survey was comprised of a comprehensive set of questions that CTRM end-users and industry consultants were invited to answer.

https://issuu.com/ctrmcenter/docs/vendor-perception