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Commodities are integral to global economies, playing a critical role in energy, food and industrial production security in the context of recurring supply chain disruptions, geopolitical developments, climate and weather events, trade wars and consequently volatile markets as a result.
PwC is helping companies in the commodity trading sector to navigate turbulent times and adapt their finance and risk operating models as requirements evolve, identify and implement the necessary technology for decision-making, as well as build trust between trading companies and their stakeholders.
Seize this opportunity to remain agile, and adapt your team and create value throughout your company.
Explore our services
Financial risk management methodology
Commodity markets are inherently volatile, and managing risk – whether market, credit or liquidity – is crucial for sustained profitability. Our experts provide tailored strategies to identify, assess and mitigate risks associated with commodity trading or commodity procurement. By implementing effective risk mitigation techniques and establishing robust risk management frameworks, we can help you navigate market fluctuations and protect your bottom line. Our services also include exposure forecasting, which allows for more precise risk assessments and proactive decision-making in trading activities.
Commodity trading technologies
In an industry marked by complexity and rapid changes, leveraging technology is essential in executing your strategy. Our services include evaluating and implementing innovative solutions that facilitate the end-to-end processes of commodity trading.
We guide you in choosing and implementing the right applications or support tools for trade execution, risk management, data analysis, trade finance and logistics in order to ensure secure and efficient workflows and enhance decision-making capabilities.
Commodities accounting and valuation
Understanding the valuation of commodities and the accounting principles that govern them is essential for compliance and risk management. Our team assists in navigating the complexities of commodity valuation while ensuring adherence to accounting frameworks. We specialise in bridging management and financial reporting as well asapplying hedge accounting, which both enable clients to align their risk management strategies with financial reporting.
By guiding you in identifying, documenting and measuring hedging relationships, we ensure compliance with standards such as IFRS 9 or ASC 815. Our approach helps to reduce earnings volatility by matching gains and losses on hedged items and instruments, which enhances transparency and accuracy in your financial statements for more informed decision-making.
Processes and control
Our team specialises in refining your operational processes and controls to prevent discrepancies and mitigate risks. By conducting comprehensive assessments, reviews and audits we can enhance your policies and procedures, covering all areas relevant to commodity trading, including fraud risk management and compliance with regulatory requirements. Our internal audit support ensures that your operations align with best practices, fostering a robust culture of compliance.
Strategy and organisation
Having a clear and coherent strategy in the commodity trading landscape is essential. The interconnected nature of trading, financing and logistics requires all components to work together harmoniously. Our team offers insights through benchmarking your organisation’s processes against industry best practices, identifying areas for improvement and developing a target operating model tailored to your business. We help set realistic objectives that align with your business goals, ensuring that your trading function is agile and equipped to tackle all challenges, both current and future.
Governance & Risk due diligence
Our team assists in evaluating potential risks associated with counterparties, trading contracts, regulatory changes, internal risk management frameworks and technology. Through comprehensive assessments, we provide actionable insights that empowers companies and financing stakeholders to make informed decisions while minimising exposure to adverse scenarios.
We can perform this risk due diligence on behalf of different stakeholders in order to provide transparency over the overall governance and risk management of a commodity company.
Trade finance
Access to efficient trade finance solutions is critical for optimising cash flow and
enhancing transactional capabilities in commodity trading. Our team offers guidance in navigating various financing options, including letters of credit, trade loans and supply chain financing, ensuring that you have the liquidity necessary to seize opportunities while minimising working capital costs.
ESG
Environmental, Social and Governance (ESG) factors are increasingly influencing investment and operational decisions within the commodity trading industry. Our specialists can help you integrate ESG principles into your organisational strategies, identifying risks and opportunities related to sustainability practices.
Contact us
https://pages.pwc.ch/view-form?id=701Vl00000gQI9CIA&embed=true&lang=en
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