Managing commodity price risk through physical contracts
StoneX’s award-winning risk management consultants combine deep market intelligence and global commodity market access to provide clients with effective hedging strategies that mitigate risk and protect from financial loss.
Three reasons to have physical commodities as part of your risk management hedge strategy
- Hedging establishes an equal and opposite position relative to the cash market so that volatility’s impact on margins can be minimized.
- A properly designed hedging strategy not only protects your company from the financial consequences of commodity volatility, but also provides management with vital decision-making information.
- A hedging strategy is the overarching solution to procuring the materials you need to protect your company’s supply chain against fluctuating commodity prices.
The StoneX approach to risk management via physical contract
A strong hedging strategy to counteract commodity price volatility will help maintain consistent revenue forecasts, anticipate accurate operating costs and profit margins, execute cost-efficient expansion plans, and deliver premium-quality customer service. Explore why customers choose StoneX for their hedging needs.
Close relationships
StoneX consultants value long-term, close relationships with their clients which enables them to know the ins and outs of their businesses.
In order to effectively protect clients from everchanging commodity prices, our price-risk management specialists take the time to understand your specific needs, goals and systems so that they can create a unique hedging plan that reduces risk exposure and protects margins.
Extensive resources
An invaluable resource at StoneX is our professional price-risk management teams, who have deep knowledge of the cash markets they cover, financing, structuring deals, hedging and risk management.
When we combine our people resources with institutional-grade trading platforms, access to global commodity futures exchanges and deep market expertise, we are a powerful resource for those who demand excellence.
Design and execution
Our award-winning price-risk management teams do not get enticed by speculative gains. They design systematic hedging programs that are built on proven commodity risk management principles and tailored to your specific business needs.
When you partner with StoneX, our work does not stop there. We help you execute the plan while continuing to monitor price movements and reevaluate hedging strategies to take advantage of basis opportunities.
Physical commodity markets offered by StoneX
Our commodity financing and trade facilitation business provides working capital to goods and services companies for the finance of commodity inventory and hedge margin. We cover a broad array of commodities, including most agricultural and soft commodities, metals and energy products.
Want to learn more?
Discuss your hedging needs with a StoneX professional.
Hedging with futures
The StoneX price-risk management team helps clients lessen the risk of a loss in the cash market by taking an opposite position in the futures market.
The short hedge
We help our commodity producers and users utilize a short hedge to lock in a known selling price so that future price fluctuations will not matter for their operations.
The long hedge
We help our commodity clients utilize a long hedge to protect against rising prices so that input requirements are met regardless of commodity price volatility.
StoneX hedging clients
Farmers, livestock producers
Who need protection against declining prices for crops or livestock, or against rising prices of purchased inputs such as feed
Merchandisers, elevators
Who need protection against lower prices between the time they purchase or contract to purchase grain from farmers and the time it is sold
Food processors, feed manufacturers
Who need protection against increasing raw material costs or against decreasing inventory values
Exporters
Who need protection against higher prices for grain contracted for future delivery but not yet purchased
Importers
Who want to take advantage of lower prices for grain contracted for future delivery but not yet received
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Upcoming events
15
October
8th StoneX Multicommodities Seminar
Webinars
|
South America
|
Language: Português Brasileiro
StoneX’s largest event, aimed at bringing together market analysis and experts to provide an up-to-date and strategic overview of key agricultural markets, as well as fertilizers, energy, foreign exchange, and macroeconomics.
15
October
8th StoneX Multicommodities Seminar
Webinars
|
South America
|
Language: Português Brasileiro
StoneX’s largest event, aimed at bringing together market analysis and experts to provide an up-to-date and strategic overview of key agricultural markets, as well as fertilizers, energy, foreign exchange, and macroeconomics.
21
October
Sugar Breakfast StoneX
Live StoneX events
|
South America
|
Language: Português Brasileiro
A strategic event that brings together StoneX risk management consultants to foster networking, updates, and planning.