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Tiger Brands Limited integrated annual report
2015 173
37 Financial instruments
continued
37.1 Procurement risk (commodity price risk)
continued
At year end the exposure to derivative contracts relating to strategic raw materials is as follows:
GROUP
Derivative contracts expiring
within 0 – 3 months
(R’million)
Unrealised
(profit)/loss
at 30
September
Hedged
value
2015
Soft commodities
Futures
(3,4)
128,1
2014
Soft commodities
Futures
(2,6)
62,7
Commodity price sensitivity analysis
The following table details the group and company’s sensitivity to a 10% increase and decrease in the price of wheat,
rice, maize and sorghum, excluding the impact of cash flow hedges.
The 10% stringency is the sensitivity rate used when reporting the commodity price risk internally to key management
personnel and represents management’s assessment of the possible change in the relevant commodity prices.
GROUP
Profit or (loss) after tax
(R’million)
2015
2014
Milling and Baking + 10%
(256,0)
(216,9)
Milling and Baking – 10%
256,0
216,9
Other grains + 10%
(126,8)
(98,7)
Other grains – 10%
126,8
98,7
Other + 10%*
(46,7)
(49,6)
Other – 10%*
46,7
49,6
Total + 10%
(429,5)
(365,2)
Total – 10%
429,5
365,2
* Other includes tomato paste, sugar, pork, soya and sundry other items.
Commodity price sensitivity is not applicable to the company.