Risk Management

LTAs and Tenor Limits

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Long Term Agreements (LTAs) and Tenor Limits (TLs)

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How are LTAs and Tenor Limits relevant at Cargill?

Relevance of LTAs and Tenor Limits at Cargill:

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Provide insight into market risk implications and how they will be managed and mitigated.

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Assure risks are understood, consistent with the Business' risk appetite and align with CRC policies and expectations.

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Provide quantification and assessment of risk and reward.

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LTAs and Tenor Limits are processes that support trading and risk performance.

What are the strengths of LTAs and Tenor Limits?

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Provide broad visibility and understanding of risk Cargill is assuming.
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Leverage experience and insight of business leadership and the CRC.

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Enable a forum for feedback on risks being taken and best practices.
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What are the weaknesses of LTAs and Tenor Limits?

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    Review is only as good as the communication of the terms and risk and reward.

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    While there is guidance, there is not a standardized format.

  • Click each number to reveal the weaknesses.

    It is not always clear to businesses which agreements/transactions should come to the CRC for approval (consult your RMG partner).

Summary

This brings you to the end of this eLearning.

You have now learned:

  • Definitions for LTAs and Tenor Limits
  • How LTAs and Tenor Limits support trading and risk performance

Continue on to the simulation to learn how to route a request in order to seek approval.