Ahh , the good old days: 2011...
Iron ore fines were $180USD/MT, my production + delivery to port costs were c$70USD/MT (or better), and I had vessels queuing over the horizon to take as much commodity as I could load.
The scheduler was king. They had to ensure that there were enough vessels ready to load and enough commodity in my port stockpile to allow round-the-clock loading. Sure, I paid a bit of demurrage, and sure, I paid a few penalties for being out of commodity specification, but at over $100USD profit per MT, I had the margin to focus on outturn above all other constraints..
That Was Then...This is Now
And now? Well, a $50USD/MT spot price for iron ore has squeezed my margins and I've had to do massive cost cutting to remain in the black. And the market has evolved; gone are the annually negotiated fixed price contracts to be replaced by more immediate spot market contracts. Pricing services have developed benchmark assessments of the spot price of physical iron ore (such as Platts iron ore index or IODEX) with specified contract quality, and buyers now tender for spot price cargos of contracted quality to best match their needs. So how do I maximise income from these new opportunities? How do I give myself a competitive advantage?
Sure, I can track quality and quantity post the fact in my ERP system. But today's environment calls for tools that enable agile, more profitable decisions, such as Eka's CTRM + QMS – an integrated commodity trading risk management and quality management system – which enables real-time tracking. (Learn more of the benefits to be gained with an integrated solution for CTRM software and bulk handling.)
Gain Real-Time Views of the Stockpile
Eka's Smart Commodity Management allows me to record the spot sale and all price escalators/de-escalators associated with the contract, and track and schedule the sale from contract writing through to execution and issue of final invoice. Now the clever bit: QMS (part of Eka's 3D Stockpile Manager) shows you graphically in your stockpile, in real-time, where the best commodity to maximize income from the sale lies, and instructs your stackers/reclaimers to efficiently recover the material and fulfill the sale.
- Sellers option to over deliver?
No problem – CTRM software records this condition and QMS accurately measures outturn tonnage as the vessel loads, allowing you to maximize income. - Need to guarantee that the average quality is within contracted sales quality?
QMS keeps a running average in real-time of the outturned chemistry. - Want to claim a premium payment for better Fe percentage and lower Si?
CTRM will adjust the final invoice from the actual quantity and quality given by QMS as soon as the hatches close. - Worried about demurrage?
QMS shows you instant and average reclaiming rates and time to complete an operation so vessels can leave on time.
Go Back to Yesterday's Margins
And not just iron ore – CTRM and QMS can be applied to any bulk commodity – our customers use Eka for trading and shipping thermal and coking coal, grains, sugar, coffee, fertilizers, etc. With the most effective stockpile management, Eka gives your company the competitive advantage in a volatile world.
In short, Eka lets you go Back to the Future to realise those margins you used to enjoy, and no need to purchase a DeLorean... (with apologies to Doc and Marty McFly).