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Description

Commodity Financial Markets: Analysing, Pricing and Hedging

Connect physical commodity flows to the financial instruments that set their price

  • 2 days — 14 h
  • In-person or virtual
  • Intermediate
  • Up to 6 participants

An industrial buyer sees raw material costs swing sharply from one quarter to the next. The instruments offered by the trading desk are described in terms of contango, backwardation, margin calls and basis risk, without any clear link to the actual physical exposure. The result: hedges that are poorly sized and outcomes that are hard to explain internally.

These two days provide the key reference points for these markets. Participants map the players and trading venues for energy, metals and agricultural products, learn to read a forward price curve, compare the hedging instruments available and then measure the basis risk that remains once a hedge is in place.

Learning objectives

  • Map the players and trading venues for the main commodity families
  • Explain spot price formation and the role of storage and transport
  • Read a forward price curve in contango and in backwardation
  • Compare the hedging instruments available for a given exposure
  • Measure the basis risk remaining after a hedge is put in place
  • Monitor positions and the associated margin calls

What makes this programme different

The same instruments are examined from both the producer's and the industrial buyer's standpoint
A hedge is built and then replayed across several price paths
The cash flow impact of margin calls is quantified explicitly

Programme

1How commodity markets are organised

From physical flows to financial contracts

  • Underlying families: energy, metals and agricultural products
  • Roles of producers, traders, processors and financial participants
  • Exchange-traded markets, over-the-counter markets and clearing houses
  • Spot price formation and the weight of storage and transport
  • Benchmark indices, deliverable quality and delivery locations

2Forward instruments and the term structure

Read the curve before hedging

  • Over-the-counter forwards and standardised futures contracts
  • Initial margin, margin calls and cash flow consequences
  • Contango curves and backwardation curves
  • Impact of rolling positions on the performance of a long-dated hedge
  • Relationship between spot prices and forward prices

3Commodity swaps and options

Building protection that fits the exposure

  • Fixed-for-floating swaps and the cash flows exchanged
  • Calls and puts on a commodity underlying
  • Collar and cap strategies to contain raw material costs
  • Reading volatility and seasonality effects
  • Comparing the cost and the rigidity of each solution

4Position monitoring and residual risks

Measuring what remains exposed after hedging

  • Basis risk between the physical exposure and the instrument selected
  • Liquidity risk and counterparty risk
  • Position limits and daily monitoring
  • Measuring and explaining the hedging result
  • Key points for internal control and reporting

Who is it for

Trading desk staff · analysts · corporate treasurers · commodity buyers and control functions dealing with these products.

Prerequisites

Working knowledge of the basic mechanics of financial markets and derivative products.

Dates & locations

36 scheduled dates between November 2026 and December 2027. Seats are confirmed in the order enquiries are received.

November 2026

December 2026

January 2027

February 2027

March 2027

April 2027

May 2027

June 2027

September 2027

October 2027

November 2027

December 2027

None of these dates suit you? We open additional sessions on request, and any programme can be run privately for your team.

Practical details

Before the programme
Online positioning questionnaire. Your development objectives are shared with the trainer, who tailors the practical case studies to your context.
Teaching methods
Theoretical input, workshops and practical case studies. Digital course materials and method sheets provided.
Assessment
Multiple-choice tests and role-play exercises. Assessment of learning at the start and end of the programme, with immediate and 60-day follow-up evaluations.
After the programme
One year of access to the e-learning platform. Self-assessment of the skills acquired and a 30-day follow-up session with your trainer.
How to register
Registration online or on the basis of a quotation.
Lead time
11 working days after confirmation of registration.
Accessibility
Accessible to people of determination. Contact our accessibility coordinator to design a suitable solution: contact@mpf-academy.ae
Start dates
Rolling intake: in addition to the scheduled sessions, this programme can start on request.