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Eka eyes Latin America for business expansion
29 Apr, 2010 View All


Eka eyes Latin America for business expansion
"To develop more business in Latin America is one of our goals" - Daniel McEvoy, Global head Mining &   Metals, Eka Software Solutions
Eka Software Solutions is a company focused on providing services for metals trading. The company, currently based in Bangalore, India and with offices in New York and London, is now aiming at the Latin American market for growth.
In the following interview, Eka's global head for mining & metals Daniel McEvoy - who was attending last week's CRU World Copper Conference in Chilean capital Santiago - gives us insight into the company and also talks about why managing risks in metals trading is so important for clients.
BNamericas: Why is it so important to handle risk management in metals trading?
McEvoy: The volatility in the markets has increased enormously and is going to be even greater in the near future. So the risk associated to the mining industry is enormous. If you think about it, a mining company takes on huge risks. First, they have to find a mineral deposit. Then, they have to prove it up as they don't know what is in the ground. They also have to be able to get it out economically and then they have to be able to market it at an economic price. They already have all these risks. Why take on more when it comes to exposure to price volatility and operational risks? Mining companies and base metals traders need systems that allow them to better manage those risks, to reduce them to a tolerable level, in order to maximize profits and be successful in the market.
BNamericas: What is the relevance of the metals and mining branch for Eka?
McEvoy: Eka Software Solutions is a company completely dedicated to the commodities industry. The metals and mining industry is the most important vertical for us and we have enjoyed much success.
BNamericas: Why is the service provided by Eka important for metals trading?
McEvoy: First and foremost, our system allows firms to comprehensively and properly record their business transactions. This by itself is a major value addition given the complexity of the commodities market. You will be surprised by the number of companies that still rely on spreadsheets to manage their millions of dollars worth of transactions.
Once all the data is recorded properly, the next thing is visibility of the current state of the business. It is absolutely vital to have an accurate and up-to-date organization-wide view of the business, without which decision making gets reduced to guess work. Our products process transactional data and convert it into meaningful information that allows users to better perform their business.
For instance, without accurate knowledge of how much commodity exposure exists, hedging decisions by the risk manager or trader could go completely haywire. We have heard of numerous occasions when this has happened. With respect to mining and metals, we cover all the commercial activities of those companies, – for example in the copper industry whether it is concentrates, blister, anodes or cathodes, we handle them from the point in time it is a commercial product including the purchases and sales processes, shipping the material from point A to point B, hedging whether it is futures, OTC or options, invoicing then right up to the company's accounting system.
BNamericas: What are the benefits for your clients?
McEvoy: Eka fully integrates all aspects of the business, both physical and financial. It includes modules on physical contracts, inventory, logistics, financial contracts, derivatives, forex [foreign exchange], position management and P&L. What we do for our clients, whether they are producers or consumers, is to manage their commercial business. We unify and automate all the information related to the commercial activities. We capture information from all the sides of the business, including purchases or sales, logistics, finance and risk management.
What we often see is information silos because the commercial activities cut across so many different departments within a company. Users are responsible for certain defined aspects and wind up doing their job independently of one another. Our system lets them enter information just once, so it is not duplicated by other users within the company, reducing the chance for errors, streamlining the process and providing transparency to the whole process.
BNamericas: What share does Latin America represent for Eka?
McEvoy: Right now, Latin America represents a small share. It's not really a market we have gone after. We have more activity in Europe and North America.
BNamericas: Do you have plans to have a larger presence in Latin America?
McEvoy: Developing more businesses in Latin America is one of our goals. As we continue to grow, we will then branch out and create other offices in other regions, and in Latin America the most important of them would be here in Chile. 
BNamericas: How do you see Chile in terms of relevance for your business? What made you come to the CRU conference? 
McEvoy: The importance of being at the conference and at the entire Cesco Week is that everyone knows everyone in the copper industry. I've been coming to Santiago and the Cesco Week for many years. There is a lot of information and you can meet with almost all of the world's companies.
BNamericas: What makes your company different from others in the metals trading business for software solutions?
McEvoy: How we approach the physical market and its associated risks. The unique aspect about our product is the manner in which it looks at the client’s business. Almost all other systems have come from the financial side and tried to create a physical system. That doesn’t do the job, failing in not just proper risk identification and its management, but critical aspects such as mark-to-market and P&L reporting, logistics operations, positions, costs, etc.
Our technology is the most modern among all vendors. It is completely, 100% java-based with web 2.0 technologies. We have a service oriented architecture, allowing it to interface easily with other systems. Finally, its thin client and web-based, so anyone can access the system from anywhere in the world and know exactly what they positions are.
By Victor Henriquez

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We wanted to replace our legacy systems with a modern and best of breed commodity and risk management system. Eka demonstrated a strong understanding of our business and had a largely ‘out of the box’ product that suited our requirement, especially around managing grain pools. We were also hugely impressed by the domain and technical competence of the Eka team. Read more.

Mitch Morrison
General Manager
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