Trade Profit and Loss

Trade profit and loss (P&L) is calculated using the data in snapshots for the despatch order(s) and set of mark-to-market terms. See Despatch Order Snapshots.

The Trade Explorer has three views of trade profit and loss (P&L): The 'flash' (that is, latest) P&L and mark-to-market (MTM) P&L of trades; the total P&L of trades across a date range and for the flash calculation; and the MTM P&L of trades across a date range and for the flash calculation.

The Trade Detail displays the full P&L for a selected date, which includes the P&L and MTM value of each line item. The Trade Detail can be accessed via the Trade Explorer, or via the Trading tab of a despatch order.

A full P&L is also available via the Despatch Order. This full P&L displays the consolidated profit and loss of all trades that include the despatch order.

The aggregated P&L for all trades for all despatch orders of a quota displays on the Quota node of the Sales Contract and Purchase Contract. Sales and purchase contract screens also include a node to display the aggregated P&L of all trades for despatch orders within a selectable date range.

Profit and loss reports can be created to summarise trade profit and loss at a specific point in time; for example, at the end of each month. Each report can have different parameters, for example, to summarise profit and loss for a district. Journal entries can be created for Profit and Loss reports. See Trading Profit and Loss Reports.

P&L Line Items

In the P&L snapshot, the line items are grouped first by sales and purchase:

  • For a despatch order (DO) that is not yet traded with another DO, the P&L snapshot displays line items of the DO and its set of mark-to-market terms.
  • For a trade between a purchase DO and a sales DO, the P&L snapshot only displays line items of the purchase DO and the sales DO.

Within the top-level grouping, the line items are grouped by:

  • Quantity—The dry mass and wet mass.
  • Product—The product base price for contracts with product pricing.
  • Price—Each payable analyte for contracts with analyte pricing.
  • Premiums
  • Contract Charges—Including optional charges from last final invoices.
  • Freight And Service Charges—Always based on wet quantities, even if the trade quantity is dry. Includes reinvoiced and mirrored costs. Includes finance service charges and costs for purchases.
  • Commodity Hedge Positions—To which the despatch order (DO) has been allocated. For spread contracts, both legs display. For swaps contracts, only the sell leg displays. Broker fees display if applicable. If multiple DOs are allocated to the hedge position, the broker fee displays only for the first DO.
  • FX Hedge Positions—To which invoice instalments of the DO's snapshot have been allocated. Broker fees display if applicable.
  • Others—Dynamic line items from last final invoices.

Within the freight and service charges, the line items are grouped in the following categories:

  • Actual—Based on the quantity that has been invoiced with actual invoices.
  • Accrual—Based on the quantity that has been invoiced, but only with accrual invoices.
  • Estimated—Based on the delivered quantity that has not been invoiced.
  • Balance—Based on the required quantity minus the actual, accrual and estimated quantities. Only displayed if the sum of the actual, accrual and estimated quantities is less than the despatch order's minimum required quantity.
  • Budgeted—Based on the delivered quantity, but using a budgeted cost until replaced with a cost or service charge with the same service type, activity, name, rate detail basis and type.

Costs that have not yet been invoiced can be excluded from trade P&L if required. See View Despatch Order Snapshot Costs.

Each group of line items displays subtotals. In the Commodity Hedge Positions and FX Hedge Positions groups, hedge positions that are not yet settled are grouped by maturity date.

P&L Calculations

The P&L of most line items is calculated as:

( Market Price - Price ) * Quantity

For service and freight charge line items, the P&L is expressed as a single value.

P&L line items are calculated by the MineMarket Marketing Service. If the Trade status definition is configured, P&L is only calculated for trades with a status that is not closed. See Status Definitions. If UseObjectNotification is enabled in the MineMarket Server configuration, MineMarket refreshes the display of P&L line items automatically.

Note: Changes to exchange rates or interest rates do not trigger the MineMarket Marketing Service to recalculate despatch order states or trade P&L. The snapshot settings control whether changes to prices series trigger recalculation. See Specify Snapshot Settings. For other recalculation triggers, see the description of the MineMarket Marketing Service.

Market Price

The market price is only applicable to hedge position line items. The market price is from the most recent settlement.

A tooltip displays the market price from the previous snapshot (if available), and the difference.

Price

For product line items, the price is the final invoice unit price of the product in the DO. This price is calculated on a wet or dry basis, as applicable for the contract.

For contract charge line items, the price is also a unit price, even for contract charges with a fixed value type.

For hedge positions, the price is the strike price from the most recent settlement.

A tooltip displays the price from the previous snapshot (if available), and the difference.

No price displays for service or freight charge line items.

Quantity

For product and contract charge line items, the quantity is the trade quantity, unless adjusted 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 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 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 controlled only on the Trading tab of the Despatch Order.

For hedge positions with a single DO or invoice instalment allocation, the quantity is the total hedge position quantity. If multiple DOs or invoice instalments are allocated to the hedge position, the quantity is divided pro-rata between the DOs.

A tooltip displays the quantity from the previous snapshot (if available), and the difference.

MTM Calculations

The MTM P&L is the difference between the current P&L and the previous P&L.

MTM values are only available if the trading settings enable the copying of trade P&L statements each day. See Specify Trading Settings.

Currency Conversions

In the P&L of an individual trade, the price, market price and P&L of line items are converted to the trade currency:

  • For trades between DOs, the trade currency is the default currency of the purchase contract's district. If the purchase contract does not have a district specified, the system default currency is used.
  • For trades between a DO and a set of mark-to-market terms, the trade currency is the default currency of the contract's district, or the system default currency if no district is specified in the contract.
  • For cost and service charge rate details with a specified fixed exchange rate, that exchange rate is used. For rate details without a specified fixed exchange rate, the district configuration is used.

When viewing the consolidated P&L of all trades of a DO (on the Despatch Order), if the trades have different currencies, all trades display in the default currency of the contract's district, or the system default currency if no district is specified in the contract. In the case of a sales DO traded with a purchase DO in a different currency, this could mean that multiple currency conversions are required. For example, a sales DO in USD is traded with a purchase DO in CAD. Because the trade currency is CAD, the P&L is stored in the MineMarket database in CAD. However, when this trade is viewed on the sales Despatch Order, the P&L is converted back into USD.

When the MineMarket Marketing Service calculates the trade P&L, if the DO snapshot and hedging P&L are not in the trade currency, the line items are converted using the following settings:

Historical P&L

Historical P&L data can only be displayed if the trading settings enable the copying of trade P&L statements each day. See Specify Trading Settings.

Historical P&L data is no longer copied if:

  • The quantity of the MTM trade is zero.

    As trades are created for a DO, MineMarket reduces the quantity that remains allocated to the MTM trade. When the DO has been fully traded, the quantity of the MTM trade is zero.

  • The trade is transitioned to a closed status. See View or Change Trade Status.

P&L Adjustments

The profit or loss of individual line items for a trade can be adjusted. These adjustments are specific to the trade's profit and loss at that point in time. However, these adjustments do impact aggregated profit and loss of the despatch order, quota and contract, and also Profit and Loss reports that include that trade. Adjustments to a flash P&L are carried forward to subsequent flash P&L statements.

When an adjusted trade P&L is copied as an historical P&L, the adjustment is also copied. Each adjustment to an historical P&L is specific to the P&L and can be edited separately without impacting adjustments in other copies of that trade's P&L. However, if an historical P&L is adjusted, and the next P&L (historical or flash) is recalculated, that next P&L will have the same adjustments. If the historical P&L from the business day before the current date (this is typically the most recent historical P&L) is adjusted, MineMarket recalculates the flash P&L, and the flash P&L will inherit those adjustments.

You cannot adjust an historical P&L if the P&L is in a Profit and Loss report for a date that is on or later than the date of the historical P&L. For example, a Profit and Loss report for 30 June includes a trade P&L. Historical P&L of that trade up to and including 30 June cannot be adjusted. However, the Profit and Loss report itself can be adjusted if required.

You cannot adjust the flash P&L or an historical P&L of a trade that has a closed status. See Status Definitions.

Adjusted profit and loss amounts display with a coloured cell background in the Trade Explorer, the Trade Detail and in despatch orders and Profit and Loss reports.

Aggregated profit and loss (of a despatch order, quota or contract) cannot be adjusted.