Research On Risk Management Of Hedging For Small And Medium-sized Commodity Companie

Global economic integration has given Chinese commodity companies more opportunities to participate in the international market competition.Under the influence of the new crown pneumonia epidemic in the past two years,the global commodity prices have experienced a roller coaster market,and the global commodity raw material and finished product prices have fluctuated violently,the commodity market has risen in price across the board,and the prices of many varieties in the global market have fluctuated significantly,which has brought a greater impact on downstream manufacturing enterprises and caused a greater threat to the daily production,manufacturing,and operation of commodity enterprises.,my country’s bulk commodity enterprises have been affected to a certain extent,especially the production and operation activities and sales activities of small and medium-sized enterprises with weak risk-resistance ability have been seriously affected by the occurrence of some risk events.Some large central enterprises and state-owned enterprises have paid attention to hedging of bulk commodities from the perspective of avoiding corporate risks and stabilizing development to effectively avoid the risk of commodity price fluctuations.Most of them have strictly followed the hedging rules for business operations.Under the circumstance of drastic fluctuations in commodity prices,the operation risk is effectively reduced.Since entering 2021,more than 900 public documents of listed companies have shown that they have used hedging business.Therefore,the effective use of hedging is the only way for the steady development of commodity companies,and the risk management of hedging appears to be very important.important.In the domestic market,many small and medium-sized enterprises from the upstream,midstream and terminal industries have gradually realized the importance of hedging to enterprises in recent years.Reducing operational risks is the most ideal risk management tool for commodity companies.However,there are still a large number of small and medium-sized entity enterprises in my country with a low penetration rate.If more and more small and medium-sized enterprises carry out hedging plans,it will definitely enhance the position of Chinese commodity enterprises in global commodity pricing.In the current complex and changeable macroeconomic environment,in the process of realizing future strategic goals,enterprise risk control management is the top priority of daily business activities.Commodities are highly capital-intensive industries.Therefore,in daily business activities It is necessary to pay attention to the effective integration of risk management with enterprise management and business management,and to complement each other with actual business and operation management,rather than conflict with each other,so as to achieve effective and good development of the enterprise in a true sense.From basic business execution operations to high-level corporate decision-making,risk management and control at multiple nodes are involved.Risk management and control throughout the entire business process from beginning to end is the guarantee for the stable operation of commodity companies.According to practitioners in the commodity industry and various data,the main reasons why most small and medium-sized enterprises do not engage in hedging business are the additional profits from the risk exposure of raw materials/inventories,the lack of professional knowledge and professional talents,and the lack of complete and effective,Applicable risk management index system,lack of comprehensive professional system for futures and spot.Small and medium-sized enterprises have not established risk management awareness for all employees,and have not implemented the risk prevention and control responsibility system for all employees.Therefore,it is very necessary and valuable to study the risk index system suitable for small and medium-sized entities in my country’s non-ferrous metal industry to carry out hedging business.This paper firstly reviews the research status of hedging at home and abroad and the role of risk management,and analyzes the necessity and feasibility of hedging for small and medium-sized enterprises.Commodity enterprises in my country use hedging strategies to conduct in-depth analysis,combined with two representative enterprise case events,analyze the risks of typical commodity enterprises in the process of using hedging,and analyze the advantages and disadvantages of different hedging strategies.Disadvantages: Taking small and medium-sized enterprises in my country’s non-ferrous metal industry as an example,the key elements and indicators of hedging for risk management are extracted,and a set of risk control indicators system for hedging risk management that is easier to implement is constructed.The Fuzzy Analytic Hierarchy Process(AHP)method provides a reference for the risk management index system for small and medium-sized enterprises in my country’s non-ferrous metal industry.At present,the domestic research on hedging risk management mainly takes a single enterprise case as the research object or studies a specific risk factor in the hedging business,which is not comprehensive enough and the practical operation is not strong enough for reference.There are two main points of research in this paper.The first is to identify and evaluate risks when non-ferrous metal enterprises carry out hedging business,and to use literature research method to identify the risk factors existing in non-ferrous metal enterprises’ hedging business,and to identify five At the same time,according to expert research,fourteen second-level risk factors were refined,and then the fuzzy analytic hierarchy process was innovatively used to evaluate the first-level and second-level risk factors qualitatively and quantitatively,so as to obtain each risk factor.The risk level of the factors,find out the common risk factors in the non-ferrous metal industry,and manage and control the risk factors of different risk levels with different strengths.The risk weights of the three risk factors of price model risk,market risk and operational risk are relatively large.Enterprises focus on coping and control.The second is how small and medium-sized non-ferrous metal enterprises can improve their risk management capabilities,focusing on preventing and controlling price model risks,market risks,and operational risks,combined with a variety of innovative suggestions to assist hedging risk management,and optimize the enterprise internal risk management system Risks in the hedging business of non-ferrous metal enterprises are put forward in seven aspects: environment,accurate judgment of risk exposure,correct identification of risk factors,strengthening the depth of risk control nodes,improving the level of professional teams,strengthening information construction,and establishing external learning channels.Suggestions for management optimization,establishing a highly operational hedging risk management indicator system,and efficiently improving the anti-risk capability of non-ferrous metal enterprises’ hedging business.This paper has practical and innovative significance for commodity enterprises to use financial derivatives tools,especially for improving the risk management ability of small and medium-sized enterprises in my country’s non-ferrous metal industry for hedging business,and has certain practical significance for improving the industrial level and reducing price constraints.