Trades

Traders need to be able to specify that a specific purchase contract will be used to fulfil a sales commitment (and vice versa). In MineMarket, this relationship is a trade between despatch orders.

Trade Types

Each trade is a one-to-one relationship between either:

  • A despatch order (DO) and its set of mark-to-market terms

    These trades are created automatically when a set of mark-to-market terms is assigned to a DO. These trades can be found in the Trade Explorer; and can optionally be included in Profit and Loss reports.

  • A purchase DO and a sales DO

    These trades are created, viewed and edited either via a despatch order, or via the Trade Explorer; and are included in Profit and Loss reports.

Despatch Order Allocations

Each DO can be in more than one trade. For example, a single large purchase DO may fulfil several small sales DOs. In that scenario, the Despatch Order of the purchase DO displays multiple trades; and the Despatch Order of each sales DO displays a single trade. Many-to-many relationships are also possible.

The maximum quantity that can be allocated to a trade is the required quantity of the smaller DO in the trade. (For example, if a trade is between a purchase DO of 500 t and a sales DO of 1000 t, the maximum quantity of the trade is 500 t.) If a single DO is traded with multiple DOs, its quantity must be split between the trades.

If a trade is for less than the required quantity of the purchase DO, the quantity can be fixed for profit and loss calculations. The quantity of at least one trade with the purchase DO (including the mark-to-market trade) must be unfixed. If the trade has an unfixed quantity, the allocated trade quantity is not changed, but the quantity used in profit and loss may be adjusted. This adjustment is to account for possible differences between the required quantity and actual quantity (for example, from loading or unloading transactions). If the actual quantity is greater than the minimum quantity for the DO, the actual quantity is used in profit and loss. The DO's minimum quantity is based on the minimum percentage tolerance of the quota. If the DO is not in a quota, or if the quota has no specified tolerance, the minimum specified for the contract product applies. If the purchase DO has multiple trades with unfixed quantities, any adjustment is applied pro-rata across these trades. Whether a trade has a fixed quantity displays and is controlled only on the Trading tab of the Despatch Order.

As trades are created between purchase and sales DOs, MineMarket reduces the quantity that remains allocated to the mark-to-market trades. When a DO has been fully allocated, the quantity of the mark-to-market trade is zero, and the mark-to-market trade is no longer displayed.

If the required quantity of a DO that is already traded is changed, MineMarket adjusts the amount available to trade. However, the required quantity of the DO cannot be made less than the allocated quantity of the DO's current trade(s).

If the Despatch Order status definition is configured, only DOs with a selectable status can be allocated to trades. See Status Definitions.

Neither parent despatch orders (PDOs) nor child despatch orders (CDOs) can be allocated to trades. See Parent and Child Despatch Orders.

  • If the DO is already in a trade between a sales DO and a purchase DO, the DO cannot be made into a PDO or CDO (of any calculation method).
  • If a DO was in a mark-to-market trade, and is then made into a PDO or CDO, the set of mark-to-market terms is removed from the DO. The DO does not display in the Trade Explorer.

Mass Basis of Allocations

A DO can be traded with DOs that have a different mass basis. The trade can be in the mass basis of either DO. The default basis is the basis of the DO from which the trade is created.

The required quantities of the DOs are converted to the mass basis of the trade as required. MineMarket uses the moisture value of the DO specifications for the conversion. This value is not overridden by later values, such as from samples.

For example, a trade of 20 DMT is made between:

  • A purchase DO with a required quantity of 100 WMT and a moisture value of 65%, which is equivalent to 35 DMT. Only 20 DMT is traded, which is the equivalent of 57.14 WMT. Therefore, 42.86 WMT remain available to trade.
  • A sales DO with a required quantity of 20 DMT. The entire quantity is traded.

Automatic Trade Creation for Linked DOs

MineMarket creates trades for linked DOs if all the following criteria are met. The source and linked DOs must:

  • Be of opposite types (sales/purchase)
  • Have a mark-to-market assigned
  • Be for the same material
  • Have the same pricing basis (product pricing or analyte pricing)

These trades are created when the linked DOs are created. Depending on the configuration of the contract link, that may be at the time of the source DO creation, at the time of invoicing the source DO, or when linked DOs are created manually.

These trades are created with the linked quantity. For example, a contract link can be configured to use a percentage of the source quantity. The trade quantity cannot be greater than required quantity of the source DO.

Trades that were created automatically can be deleted. MineMarket deletes the trade. If the trade is in a closed status, the linked DO cannot be unlinked.

If a linked DO is cancelled, MineMarket sets the trade quantity to zero. If a source DO is cancelled, MineMarket cancels the linked DO and sets the trade quantity to zero.

Contract Approval For Trading

Trading settings include an option to require contract approval for trading. See Specify Trading Settings. If enabled, only despatch orders of contracts with Approved For Trading checked can be included in trades and Profit and Loss reports. This check box is on the Contract Settings node of the Sales Contract or Purchase Contract. If the contract is not approved for trading, its despatch orders do not display on the Trade Explorer, and trades cannot be created from the despatch order's Trading tab.