SAP for Mill Products

Differentiate in Commodity Markets

Market demand is cyclical and slowing down globally. Production overcapacity, high energy costs, commodity price volatility, and regulatory requirements expose mill products companies to increased risk and force them to control costs.

The population in emerging markets is growing constantly, increasing in wealth and consumption. Mill companies are profiting from this trend by providing products at the first level of consumption. But raw material prices are increasing and displaying increased volatility, trends that create a very competitive business environment for mill products companies, with increased risk of higher prices and lower margins.

In an attempt to secure raw material supplies and reduce commodity price risk, commodity customers are engaging in mergers and acquisitions. At the same time, there is an increased focus on hedging of raw material and energy supplies.

In addition, commodity suppliers must monitor increasing regulatory requirements and efficiently manage their responses to minimize the cost of compliance and the risk of supply chain disruption.

The result of these developments is the increased complexity of supply networks. A responsive network that meets demands, proactively manages supply chain risks, and responds in real time to supply chain events is essential. Competitiveness and long-term success now depend not only on low price but a high level of customer satisfaction as well.


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