Reports E/CTRM Software – To Build or Buy? | Page 14

CTRM for Ags & Softs
Summary
Though there are numerous providers of CTRM and CM software currently catering for a variety of ags&soft commodities,
many are essentially niche solutions targeted at a specific geography and/or commodity. However, there are a number of
solutions, primarily from the larger vendors in the market,that are truly multi-commodity capable, with significant
functionality to address many of the requirements of large scale multi-commodity trading, merchant and processor
companies.As these larger vendors continue to grow their market reach, ComTech expects there to be additional
consolidation among vendors over the next few years, with some smaller vendors acquired by the larger, and some paring
of the numbers asa few of the niche providersbecome stranded or otherwise fall by the wayside.
While there isn’t yet an‘all singing and all dancing’ solution for all ags&softs commodities, whether for trading and risk
management, or for commodity management, there are a number of vendors, both large and small,that do have a fairly
comprehensive footprint across several different commodities (Figure 1) and can address many, if not most, of the
components of the supply chain.
Given the very dynamic nature of the ags & softsindustry today -with ever-changing supply and demand patterns,
continuing globalization, increasing verticalization and price volatility - it will be difficult for any singular solution to emerge
from this group of vendors that can dominate all commodities in all markets.Simply put, ComTech expects, barring any
unforeseen events, those same large vendors will continue to dominate in their categories (commodity or geography) for
the foreseeable future, with their continuing growth coming from investments in both organic development and acquired
functionality.Additionally, the market evolution will continue to drive the merging of TRM and CM functionalities and will
lead to the emergence of a larger number of vendors that can satisfy, at least minimally, both sets of requirements.
As ags & softscommodity companies seek out new CTRM/CM solutions, they will need to be increasingly vigilant in terms
of the capabilities and track record of each vendor/product that they might be considering. While many vendors will lay
claim to capabilities for addressing a wide range of ags and soft commodities, in this broadly defined market, the devil is
truly in the details. Physical ags & softs can be, and usually are, very complex in terms of physical characteristics, quality
measurements that impact value, physical logistics, and processing requirements. While more than few vendors will be
able to address some of these specific requirements for a broad range of commodities, very few will be able to address all
the specific requirements for more than a few of the commodities.As such, buyers must test, using their own “real world
scenarios”, eachprospective solution at a very detailed level for every commoditythey wish to manage in the system.
Hopefully, this report will provide buyers some sense of the landscape of solutions and acquaint them with many of the
complexities that need to be considered when seeking such solutions.

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