Risk Management
Each stage in the commodity trade process has high level risks that can be categorized into the three core areas shown below.
ATS mitigates these risks and reduces costs to all parties by becoming a key stakeholder and maintaining strong control over the collateral in each stage of the commodity trade process.
Contact ATS to facilitate this process to reduce your risks in each category when trading commodities.
operational
- Product quality
- Finance
- Legal
- Logistics
commercial
- Contractual risks
- Regulatory risks
- Volume
technical
- Measurement
- Performance
- Specifications
did you know?
Coal superintending companies normally work for the coal mine and provide coal sampling and assaying service. Typically they all work to “Quality Systems” (ISO 17025). All have procedures established to control and monitor all generic aspects of cargo management. The superintendent will typically sign off a cargoes quality and weight. Unfortunately they do not work to ISO 9000 that states that systems will manage risk. Superintending companies manage what the coal mines ask them to manage.
The systems of the coal superintending company can fail when:
1. The coal mine has asked for an incomplete set of coal properties to be measured. Thus only a sub set of the required data is collected and the cargo is signed off against this subset. This is more common with coking coal mines who manage coal quality like they are selling a steaming coal.
2. The mine logistics do not allow adequate sampling from a cross belt sampler. Some mines can limit the number of samples to reduce cost. The sampler may only have inferior sampling options like spear sampling from wagons. The sampling saved may reduce cost but increases reporting risk.
3. There is no homogenisation of the product between the mine and load-out vessel. This increases the problem of reduced sample frequency.
4. There is corruption of the sampling or in the laboratory assays. Whilst not common in Australia, bribery is a problem in some countries.