AI-powered supply chains
Benefit from the performance of tactical
Enterprise AI to make better sourcing decisions.
hedge21 commodities suggests optimal hedging decisions to counter spread risk of commodity prices.
21strategies' hedge21 commodities helps companies which require to procure raw material. We use third wave AI to optimize procurement decisions. With AI powered hedging of spread risk, we enable greater stability and reliability in commodity supply.
Benefits
Spread risk ▼
Counter exposure and hedge risk with cash settled instruments as your instance of hedge21 commodities computes and suggests it.
Hedging cost ▼
Your instance of hedge21 commodities balances hedge cost and exposure to make the optimal proposal when to
hedge and how much to hedge.
How hedge21 commodities helps trading firms
| Commodity supply challenges | hedge21 commodities |
| Commodity traders face spread risk - this is the risk that procurement of raw materials is more expensive than the sell price for the raw material. | Commodity traders can hedge their spread risk by trading cash-settled futures. hedge21 commodities computes the optimal hedge decision. |
| Commodity traders have limited inventory space. | Commodity traders can go digital with the amount which they cannot lay on stock. hedge21 commodities helps them trading cash-settled instruments instead of physical stock, and it can support making a decision to build up physical stock strategically. |
| Commodity traders have limited working capital. | hedge21 commodities helps keeping optimal inventory levels of raw material. |
| Commodity traders cannot easily make prognosis about future rates. | hedge21 commodities component called Recognized Market Picture computes a prognosis systematically every day. |
Make optimal procurement decisions in dynamic markets.
Optimal procurement prices of commodities are key to a manufacturer's revenue in a complex and interconnected world. Rate changes, raw material availability and inventory capacities, working capital or delivery date commitments make optimal procurement of commodities a highly constrained problem which is hard to handle by humans. 21strategies' hedge21 commodities computes decision support to hedge spread risk. Depending on a manufacturer's parameters such as exposure, inventory levels, inventory capacity and delivery dates, 21strategies' hedge21 commodities has a look at the commodity markets and their pricing to determine AI powered hedging and procurement decisions in real time.
Shape the future.
With hedge21 commodities, 21strategies optimizes decisions within supply chains. Like all of our third wave AI,
hedge21 commodities is cognitive, too. The key: thinking in scenarios. hedge21 commodities attempts to imitate human capabilities: perceiving, understanding,
thinking, planning, decision-making. This requires deep mathematical thinking that goes beyond the conventional AI approach of classification and categorization of data. 21strategies' third wave
AI is key to full technical autonomy - to greater agility, more resilience, and forward-looking action at machine speed.
Hedge risk.
Realize opportunities.
Transparent, predictive, flexible: hedge21 commodities manages the complexity of global supply through optimal hedging
activities.
It computes market forecasts and changes of effective hedge rates. Foreign currency and commodity hedging is done in dependence of the underlying and other constraints a hedging process needs to
follow. With a real-time look-up of market rates, hedge21 commodities determines the most advantageous procurement timing and sizing. Inventories remain balanced, and working
capital efficiency is improved.
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