eng
About   |   Newsletter
Demand & Supply Chain Management Evolution


     
Document Detail
Language: English

Managing Supply in Volatile Agriculture Markets

 
 
 

Company: A.T. Kearney
Tag:



Hedging is not the only way to address volatility. A.T. Kearney research finds that an integrated approach to commodity risk management separates those who react to volatility from those who manage it.

When volatility hits the financial markets, investors shudder. When volatility hits the commodities markets, corporations shudder. The recent U.S. drought reinforced this message as it affected the price of corn, soybeans, animal feed, and other inputs to the food supply. The drought and its impact on future commodity prices are expected to have serious repercussions on all food prices.

We recently surveyed 21 chief procurement officers (CPOs) and heads of the commodity risk management functions of major food and beverage companies. This is the first in a series of studies to assess the impact of rising commodity prices and gauge corporate approaches to commodity risk management. Study participants were asked a range of questions, including: What impact is the rise in commodity prices having on your company? What are your expectations for the future? How do you approach and manage risk? How is your company positioned for the future if commodity prices remain volatile for the next several years?

Overall, our participants know that increased volatility in commodity pricing is not a short-term phenomenon. In a global marketplace, weather shocks—hurricanes, tsunamis, floods, or drought—are recurring events that will increase price volatility. Other factors such as increased global demand, geopolitical conflicts, and biofuels are causing a host of new headaches.

They have largely relied on hedging to manage their risk, maintain costs, and ensure a more predictable source of supply. Now, however, given the size and scope of the influencing factors and recognizing that commodity volatility cannot always be controlled, they say hedging alone is no longer a sufficient risk management approach.

 

 





read the full document >>
(external link)
  
 

 

 
Consult A.T. Kearney Documents in:
 German  Italian  Polish  Spanish

Other Documents of
A.T. KEARNEY
in English
:

Achieving Excellence in Retail Operations

Assessment of Excellence in Procurement Study, 2014

Assessment of Excellence in Procurement Study: Focus on Australia

Boost Procurement's Buying Power with Analytics

Building the Brand of Procurement and Supply

Challenged by Complexity? Quantify It!

China Pursues Excellence in Logistics

Collaborative Supplier Innovation

Conducting the End-to-End Value Chain Orchestra

Destination Latin America: A Near-Shore Alternative.

Driving Spend Management Through Advanced Analytics

Driving Top-Down Change from the Bottom Up

E-Auctions in India: A Sleeping Giant

Eradicating the 'high-inventory-poor-service-level' problem

Follow the Procurement Leaders: Seven Ways to Lasting Results

How to Become a Procurement Champion

iCPO, We've Got an App for That!

In Pricing, Success Breeds Success

India's Auto Component Suppliers: New Frontiers in Growth

Indirect Procurement: Too Many Missed Opportunities

It's Time for a Step Change in Pharma Operations

Large Capex Projects: Solving the ROI Dilemma

Making Supplier Relationships Work

Making Sure Lean Stocks Are Properly Nourished

Managing a Global Supply Chain in a Globally Challenged World

Managing Food and Beverage Supply in a Constrained World: Segmenting Your Suppliers

Mid-Term Logistics Optimization in Chemicals: All for One and One for All

Minimizing Supplier Risk

Outside the Box Distribution

Planning for Success in 2010

Procurement: The Last Best Place for Results Improvement

Putting the Wholesaler in the Driver's Seat. Best practices from the retail industry to improve profitability and gain competitive advantage.

Ramping Up Supplier Capacity in Volatile Times

Rethinking Supply in Food and Beverage

Sharing Supply Chain Data in the Digital Era

Six Driving Forces in Manufacturing

Solving the Reshoring Dilemma

Sourcing Success Under Tight Time Pressure

Strategic Procurement for Financial Services. Tapping hidden savings potential

Supplier Power: The New Competitive Differentiator

Supply Availability for Food and Beverage will Trump Price: Manage Your Supplier Relationships

Supply Chain Risks in Remote Locations

The Assessment of Excellence in Procurement Study 2017

The Case for Supplier Development

The China Cold Chain Is Heating Up

The Connected Value Chain: Creating Durable Value with Digital

The Evolution of Supply Management

The New Language of Procurement

The Procurement Leaders of Tomorrow

The Purchasing Chessboard™. Buying in turbulent times

The Risks in Remote Locations

Time To Tell Your CPOs to Collaborate With Suppliers

Total Cost Optimization. Reducing total delivered costs through improved production and distribution planning

Toward Excellence in Compliance Management

Transforming Procurement into a High Performer

Unlocking the Value of Tail Spend

Value Focused Supply, Linking Supply to Business Strategies

What Makes an Effective CPO

With Acquisitions, Procurement Planning Pays