The CTRM Blog

Last week I attended Solarc’s Ascent conference which was held at the Hyatt Regency Lost Pines Resort near Austin. As they have done in past years, Solarc put on a terrific, well produced event, with several hundred folks in attendance, including customers, Solarc personnel, and technology partners.

Solarc’s president and founder, Brad Anderson, highlighted many of the new customers the company has signed in the last year, including Marathon, Con Agra, Vattenfall, QEP, True Oil (aka 88 Oil), Kolmar, Kuwait Petroleum, and others. The company has seen good sales activity in all their covered commodities and across most geographic regions. In fact, Mr. Anderson pointed out that half of the company’s business is now comprised of companies that operate outside the North America, or have significant operations in both EMEA and North America.

SolArc appears to be having success with their new Risk Solutions Group. Last year they hired Dr. Rick Boesch, who has constructed a number of successful risk applications and solutions for CSFB, Deutsche and Sungard. The New York Observer recently reported that they are expanding their New York office. I recently caught up with Rick Boesch, Managing Director of Risk Solutions and Alan Gunn, VP of Product Marketing to understand what their plans are given the recent news.

Oil prices are at their lowest in 10-months and falling with Brent headed below $100/bbl. Oil stocks are also taking a battering as markets free fall yesterday and today. In fact, all energy commodities prices are down but some agricultural commodities are showing gains and Gold prices continue to climb. Across the broader commodities complex then its a mixed bag. Meanwhile, Chinese inflation hit 6.5% above the limit set by Beijing.

A quick look at Bloomberg this morning and all I see is red – except Gold which is at a record high (again). Fears about defaults, debt and recession are driving some panic in financial markets and over spilling into commodities. Cash or Gold is King. I’m no trader nor an expert on forecasting prices but I can’t help think that this is an over reaction in the commodities complex. I also note, hidden between the gloomy stories, that China’s inflation may have exceeded 6%. Asian growth continues and surely this alone ought to be enough to prop up most commodity prices? We will see……

I just got back from a short break in Hungary. I’d never been to Hungary before and was surprised by the prices there which were higher than anticipated and by the language. Hungary is apparently tied to some extent to the Euro despite still having its own currency which probably explains the higher prices! I also learned that the language – which is so different to the slavic languages of central Europe or to German or other languages in the region is more like Finnish! Apparently, the Hungarians were originally invaders from Finland and despite lots of interaction with other cultures over the centuries, the Finnish nature of its language remains.