An integrated multi-metal producer with limited hedging capability acquires a zinc refinery dependent entirely on third party feed. The executive team realize they face large and complex inherent price risk and need to bring in people experienced in implementing ground-up risk management programs or risk facing large losses on feed purchases. We are called in to:
Upon takeover, the newly appointed risk manager is able to use the new control system and hit the ground running implementing hedge cover on risks as they occur while accounting can report on all positions under hedge accounting. Subsequently, commercial and hedging staff are trained to enhance financial contributions by dovetailing commercial activities with those of hedging to extract value from changing market conditions. Guidance notes are developed and left for reference to ensure efficiencies are maintained.