Commodities investment – know your options, manage your risks

Questions addressed include:

• Commodity prices have witnessed extreme levels of volatility during the past three years. What are the best techniques for companies and investors to hedge against the most extreme elements of these price moves? 
• One trend during the past 18 months has been a shift from structured hedging solutions to shorter-dated, more vanilla hedging. What are the pros and cons of this approach? 
• Should commodity companies - whether producers or users - sell options?
• How can banks such as Standard Chartered help miners and other companies with commodity exposures with their financing needs? 
• There is some traction in the shift from take-or-pay pricing, which has caused deep divisions among raw material producers and consumers, to index-linked contracts. How would you assess progress in this area? Are markets sufficiently deep to enable a liquid derivatives and hedging market?
• Investors are once more eyeing commodity investments. What are some of the best ways to access commodity investments for first-time buyers? Specifically, what are the major risks and returns?