Man­age­ment of com­mod­ity price risks in in­dus­trial pro­cure­ment

Commodity price hedges are a key instrument in risk transfer for companies with high expenditure on raw materials or energy. Typically, the derivatives used to hedge commodities have special features compared to derivatives in other areas of the financial market. The project aims to describe the main characteristics of commodity derivatives and to investigate different hedging strategies for three exchange-traded industrial metals. A systematic outperformance of rolling hedging strategies over 24 months for the metals copper and nickel will be determined in the respective observation period between 1995 and 2013 and 1999 and 2013. The results allow the management of companies with a high purchasing volume for these two raw materials to optimise the risk transfer with increased planning reliability. The detailed description and the exact results were published in the Controller Magazin 01/2016.