Episode 282: Part 2: Commodity Risk Management with Olivier Kaczmarek

In this episode of Corporate Treasury 101, we dive into the complex but essential world of commodity risk management with Olivier Kaczmarek, Partner at O2 Finance and a seasoned treasury consultant. We discuss how companies can identify, assess, and mitigate their exposure to commodity price fluctuations through both strategic planning and operational tools. From forecasting exposure and selecting the right systems to aligning strategy across procurement and finance, this episode sheds light on how corporates can proactively manage commodity volatility. We also discuss real-world examples like how Ryanair saved €1.4 billion through effective fuel hedging and why financial derivatives should be your last line of defense, not the first. Whether you're exposed to gas, metals, or oil, this discussion offers a clear roadmap for building a solid hedging framework that goes far beyond the treasury desk.Olivier Kaczmarek shares his proven approach for helping multinational companies mitigate commodity exposure. With over 20 years of experience in the field, Olivier explains how to identify implicit versus explicit risk, the importance of aligning your hedging strategy with market behavior, and what KPIs you should be tracking to measure success. From system implementation to pitching the project to the CFO, this episode is full of strategic and practical insights for modern treasury teams.What You’ll Learn in This EpisodeThe four types of commodity risks: direct vs. indirect, explicit vs. implicitHow to forecast commodity exposure based on sales and production dataWhy financial hedging comes last in a complete risk management strategyReal-life examples of how companies like Ryanair use commodity hedgingCommon tools used in commodity risk management (SAP, FIS, Orchestrade)How to align strategy between procurement, finance, and treasuryBuilding internal awareness and pitching risk projects to the C-suiteKPI strategies to evaluate risk performance and decision-makingEpisode Breakdown & Timestamps [00:00] Introduction and AFP Partnership (Get $100 Off CTP Certification) [01:22] Why commodity risk is often overlooked in treasury [02:51] Forecasting energy, input, and production exposure [05:18] Using supplier price strategies and arbitrage [06:21] Understanding direct vs. indirect, explicit vs. implicit risk [10:57] How pricing strategies protect brands from volatility [13:06] Ryanair's €1.4B gain from fuel hedging [14:16] Strategic hedging vs. following the competition [15:24] Tools and software used for commodity risk [17:09] Hedging vs. operational decisions: which comes first [19:14] Building your strategy from the ground up [21:52] When financial derivatives are the right move [24:30] Operational ideas: integration, re-engineering, 3R model [26:36] KPIs, the monkey benchmark, and measuring value [28:12] Pitching a risk project to the CFO [30:27] Who should own commodity risk management[31:31] Where to learn more about O2 Finance and OlivierFollow our guest, Olivier Kaczmarek:Website: https://www.o2finance.be/ LinkedIn: https://www.linkedin.com/in/olivier-kaczmarek-5200602/ Follow Corporate Treasury 101:Website: https://corporate-treasury-101.com/ LinkedIn:https://www.linkedin.com/company/86645197/admin/dashboard/  Follow Hussam & Guillaume:Hussam on LinkedIn: https://www.linkedin.com/in/hussam-ali-6bb69186/ Guillaume on LinkedIn: https://www.linkedin.com/in/guillaume-jouvencel/ Gha Marketing Website: https://ghapodcast.com/ #CommodityRisk #Treasury #RiskManagement #CorporateFinance #CTP #FuelHedging #Procurement #FinancialStrategy #TreasuryTools #FinancePodcast #Ryanair #CTPDiscount----------------------------------------------------------------------------------Get $100 off any AFP product, including their CTP Exam Prep Platform, using our discount code! Find this and More on our partner's pagehttps://www.corporate-treasury-101.com/partners-page