CTRM
are demanding faster, easier, and intuitive access to information,” Jabbour adds. Many traders have discovered that as they develop
new strategies (including expanding their portfolios of traded products), their CTRM systems are not capable of supporting them. Additionally, as the relative value of each trade increases with rising prices, pre-trade analysis and valuation becomes even more critical to the decision making process exposing further weaknesses in systems. Larger, more diversified trading organisations, are
now looking more and more at single vendor solutions to deal with these issues; one vendor to solve all their requirements. At the same time, smaller companies are focussing on Software-as-a-Service (SaaS) or hosted deployment which offers an affordable solution with sufficient functionality to be an attractive alternative. Offering a ready and affordable source solution is a real trend in the mid-tear market, according to Reames, At the same time, this has the potential to put downward pressures on traditionally deployed systems.
Going Forward The market for CTRM software has become more
buoyant of late; both in terms of deployment and M&A activity. Growth rates in the range 10-20% are expected for the leading vendors going forward according to CommodityPoint, with analytics, data management reporting, and compliance services especially important. Their analysis sees CTRM systems growth occurring in an number of ways, with the total market expanding to incorporate new geographies and new industry segments. In particular they expect to see:
• Strong growth rates for ags/soft commodity CTRM through increased adoption;
• Strong growth in Asia-Pacific region –particularly for Crude, Ags and Softs;
• More consistent demand and growth in geographies outside of North America;
• Continued growth in SaaS, Cloud and other cost effective solutions;
• More interest and growth in broader solution suites that integrate supply chains and assist in the
management of business processes across supply chains
• Increasing participation of non-traditional buyers such as food processors and retailers, manufacturing;
• Increasing interest in optimization/cost reduction;
• Increased spend globally for services in data aggregation, reporting and compliance.
Given the number of vendors in this space, many believe
there is a ‘saturation’ of providers, from single product market specialists to those covering all geographies and commodities. While this has strengthened M&A activity over the last 18 months [as evidenced by the acquisition of Solarc by OpenLink and Navita and Viz Risk Management by Brady plc] there remains further
room for the larger vendors to grow organically as well as through acquisition. For the smaller players, they really need to differentiate themselves; “either horizontally (e.g. through the logistics chain) or vertically, by providing specific capabilities that may not be adequately addressed in a full market system,” says Reames. And there is also ample room for more specialised
players – like Contigo – to extend their reach. Their clients are looking to extend the scope of the ‘traditional’ CTRM and are moving toward a more integrated market approach. “Contigo is seeing more demand from the ‘upstream’ side of the business – inputs into the CTRM system – than has historically been the case,” says to Jon Yeomans, Director of the Birmingham-based developer of specialist software for the energy industry. These inputs include demand management, product logistics, physical product deliveries, and energy broker management services. “Clients also want advanced automation such as links to exchanges and EFET to allow enhanced levels of STP.” SaaS CTRM specialists Aspect Enterprise Solutions
emphasise the increasing need for multi-commodity support tools. At the same time, companies are also placing greater emphasis on executive awareness, internal controls, approvals, notifications, workflows, audit, and reporting capabilities, according to market leaders Allegro Development. We seem to entering a new phase of the CTRM
development process as the demands from end-users expands and becomes more complex. This includes better physical commodity trading support in a multi-commodity environment with enhanced logistics capabilities where required. On the technical side, service orientated architecture (being able to quickly link and combine capabilities with CTRM systems via web services and other capabilities) is showing up as an important characteristic. And SaaS or hosted (and cloud based) solutions also remain a growing capability in terms of market need. Centralised data exchange will also be more sought after, as will the incorporation of social media. “For example, instant messaging is a growing part of business practice in North America. Capturing IM will be an increasingly important CTRM capability,” suggests Reames. “Now that many companies have deployed some
version of a first generation E/CTRM system, these users are increasingly aware of the costs and risks of ‘after the fact’ brute force integration,” notes Jabbour. “This painful experience has been a key motivator of many recent replacement activities.” As commodity business has become ever more
complex, more companies are directing their attention towards CTRM systems, and inputs into them, making the choices for deployment and/or enhancements ever more complex themselves. •
www.commodities-now.com June 2012 35
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96