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Offerings


We’ll help you solve the problems created by volatile commodity prices

TECHNOLOGY | CONSULTING

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Offerings


We’ll help you solve the problems created by volatile commodity prices

TECHNOLOGY | CONSULTING

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01

Commodity price risk management

CONSULTING

02

Commodity price predictions

TECHNOLOGY

03

Risk position tracking & reporting

TECHNOLOGY

04

Energy advice & management

CONSULTING


 

01 Commodity price risk management

 
 

We’ll help you manage volatile commodity and raw material prices better, so that you improve margins by making faster and better informed buying (and selling) decisions.

 
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Whether you are starting from scratch or want to fine tune your existing capabilities, we are the experts in the US and Europe at implementing and running Commodity Price Risk Management in large manufacturers, retailers, FMCG firms, etc.

Commodity markets are volatile and dynamic, continuously peaking and troughing. So managing your exposure to those markets also needs to be continual and dynamic. We'll show you how to navigate these ups and downs, stabilize earnings, reduce costs and, most importantly, enhance profitability.

How do we do this?

We help shine a light on the commodity price risks your company faces, how well you are protected and how you can profit. The risk and the opportunity. By evaluating your current approach, we can show you where improvements can be made and then we’ll work with you to put them in place.

  • We typically work with closely with treasury and sourcing/ trading functions.

  • We identify and quantify the risks you face.

  • We look at your risk appetite and how it’s reflected in your risk and trading activities. 

  • We help develop your price risk management and hedging strategies.

  • We develop and put in place all essential governance and compliance.

  • We review your data and technology requirements.

  • We advise on the skill sets and culture needed to succeed.

  • We look at the commercial terms you have with your suppliers and work with you to develop the right constructs.

  • And, perhaps most importantly, we spend time making sure you and your teams understand the changes needed to ensure your commodity price risk management efforts succeed.

It’s complex - not complicated. And the results are simple:

Lower risk. Lower costs.
Greater certainty. Greater margin.

 

Talk to us to find out how we can help you to better manage the volatility you face:

 

 

02 nouse.io

Commodity price predictions using A.I.

 
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nouse.io uses artificial intelligence to predict the future prices of commodities, so that you make better decisions.

 

The problem:

If you have commodities or raw materials in your cost base, you need to forecast future prices. Investment banks employ teams of analysts to do this. Most other businesses don’t. They don’t because they can’t afford to. In practice, it’s often one element of someone’s broader role, such as a buyer or a treasurer.

And it’s a hard task thanks to:

  • Volumes of data: Due to increasing transparency in the markets, the number of data sets available is getting ever larger. And the number of alternative data sets available is mushrooming.

  • Separating the wheat from the chaff: Knowing which data is important, continuous analysis, and making the right inferences is a growing challenge.

  • Human flaws: People often get ingrained ideas about how a market ‘should’ work, and emotion can cloud judgement.

  • Volatility: Prices are increasingly volatile - most commodities and raw materials prices swing by 30-60% a year.

The solution: nouse.io

nouse.io was created because continuously monitoring the ever-growing number of news sources, analyzing the dizzying number of data sets, and deciding which events impact the future price, is an impossible challenge for any person or team.

What nouse.io does is to harness the power of artificial intelligence on standard and alternative data sets to forecast commodity prices.

Key elements:

  • Multiple time horizons: nouse.io predicts what the prices will be in 1 day, 1 week, 1 month, 3 months, 6 months and 1 year time horizons

  • Global: nouse.io covers the European, North American and Chinese futures markets

  • Conviction: The predictions include lower and upper bound numbers that are ‘80th percentile confidence bounds’ - so we would expect the actual values to be inside these limits 80% of the time

  • Performance reporting: nouse.io includes an indication of how successful each prediction has been

  • Daily: nouse.io’s predictions are updated on a daily basis

Commodities covered:

  1. Energy: power, gas, diesel

  2. Agriculture: wheat, corn, cocoa, sugar, cotton, ethylene

  3. Metals: aluminium, copper, cobalt, nickel, steel rebar

We are always adding more commodities to nouse.io. Any not covered today can be added relatively quickly on-demand – get in touch to discuss your needs.

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Enables better decision making

  • A vast number of standard and alternative data sets are analyzed

  • You can see the conviction of each prediction

  • A machine learning loop enables the AI to improve each day

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Scalable

  • Easy to scale across many commodities

  • Takes a matter of seconds to implement

  • Significantly more cost effective than employing analysts

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Goes beyond human capability

  • No human is able to scrutinize the vast number of data sets that nouse.io does every day

  • Emotion, bias and other human flaws do not cloud the predictions

  • Calculations are run every day, without fail


 

03 AMO

Risk position tracking & reporting

 
 

Our AMO platform provides you with the governance and compliance necessary to proactively manage your price risk, in an automated, secure and simplified manner.

 

The AMO platform is purpose built by price risk experts for the sole purpose of managing the commodity price risk activities of large corporates.

  • AMO monitors the markets and calculates every day your risk positions. If you use VaR, it tracks this too.

  • AMO stores your agreed risk policies and appetite for risk, captures your forecasts and trading activities, and combines all this data with market prices to track, calculate and report performance.

  • It's an independent, auditable, and accurate ‘single source of the truth’, allowing everyone to be on the same page.

  • Traders have the freedom to act in a way that builds trust and encourages high performance.

  • Importantly, traders are separated from the task of managing and reporting on your risk position.

  • It encourages closer working between your treasury and procurement/ sourcing departments. Treasury gets fingertip visibility over activity, and is assured that any activity outside the agreed policies will be immediately alerted to them, enabling the situation to be remedied rapidly.

 
 
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Reduces your risk
AMO tracks your activity and market prices, reports on your fluctuating risk positions, and alerts the business of any price movements or trading activity that mean the agreed risk or trading policies have been breached.
 

Solves the issues of Excel
Compared to Excel the platform is fast, accurately carries out complex calculations, is immutable, deals with and stores large data sets, prevents human error, is accessible on-line, and has the highest levels of security.

Quick and easy to set-up
Compared to 3-6 months needed to implement complex commodity trading systems, AMO takes a few hours to set-up, is intuitive to use, and requires little training. It also comes at a fraction of the cost.

 


* What do we mean by 'Middle Office'?

Risk management best practice is to have a 'middle office' that is separate to your 'front office' traders. Its core purpose is to monitor, quantify and report on the company's price risk.

 

 

04 Energy

 

Energy advice & management

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Giving you the benefit of our deep expertise across the broad area of energy management

 
 
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Energy is where it all started in Flow&Ebb. We had a hunch that the same principles we developed in helping our clients to manage energy price risk could be applied to other commodities. And we were right.

Our clients benefit from our deep energy expertise. We frequently advise some the world’s largest buyers of energy, other energy consultants, and private equity and investment managers.

We can help you in the following areas:

  • Energy procurement - we offer a transparent alternative to the broker/ TPI model. We help our clients by tendering contracts, ensuring suppliers perform as they should, supplier management, etc.

  • Price risk management - price risk strategy, policy development, hedging strategy, position tracking and reporting

  • Strategy development - developing the right strategy for you, ensuring you maintain a 3-5 perspective

  • Demand management - demand / consumption reduction programmes, enabling you to take advantage of emerging and established energy efficient technologies

  • Market insight - proactively giving valuable insights into what’s driving energy prices, putting you more in control

  • Distributed energy - advice regarding renewable energy and other on-site energy generation (solar, CHPs, etc.)

  • Reporting - consumption data collating and bespoke on-line reporting, league tables and savings tracking

 

Find out how we can help you take more control over your energy management: