A second opinion on the future of raw material and intermediates' prices

Who we are and what we do

Brightspot is a specialist research firm dedicated to supporting companies with analysis of future price developments of raw materials and chemical intermediates. Our analysis covers both primary as well as secondary (i.e. recycled) materials. With intermediates we mean chemical compounds formed by one reaction and then either being ready for their end use, or being utilized in another reaction.

Based on our analysis of cyclical price behaviour we make price projections, i.e. forecasts about price levels in the coming months. Our clients are corporate strategists, business unit managers as well as purchasing managers of companies that either produce these raw materials and intermediates themselves, or buy them for use in their own production process. They are all looking for more insight in the revenue that is to be expected or in the costs for their end products.

These are the benefits you may derive from our work

  1. Your bottom line will improve. Knowing in advance to what levels prices are likely to rise or decline will assist you in making the right purchasing decisions, possibly contributing significantly to your bottom line.
  2. Your competitive position will strengthen. Advance warning that rising prices are bound to reverse may help prevent excessive purchases of raw materials and thus avoid impairing your company's competitive position with inventory that has been bought too expensively. Vice versa, in falling price environments having advance warning of future price appreciation permits to plan for purchases at attractive price levels.
  3. Your risk management will improve. The mere fact that you have a second opinion on price development at your disposal, based on thorough analysis of factual numeric data, will contribute to the quality of your decisions on buying feedstock for your production or selling your inter- mediates to others. Regardless if this second opinion challenges or confirms your own views, it will bring you a different perspective.
  4. Your understanding of the long-term cyclical behaviour of prices for your commodities will improve. Knowing where these commodities are currently in their long-term price cycle will help you in understanding what is likely to come over the next months and even years. This knowledge may be very valuable in your strategic decision making process.
  5. Your budgeting will be more realistic. Knowing what prices to expect for your input costs, as well as (if and when possible) what revenue will come from your intermediates or end products, will allow you to have a more realistic budget as well as a better idea about the evolvement of your margin.

What makes us unique

Technical analysis, as our type of price analysis is also known, is practiced widely in the financial markets. For decades it has been used to interpret price development of stocks, bonds, currencies and commodities, at least those commodities that are securitized. As a result there is a vast body of knowledge available about various methodologies that may be used to gain the required insights and about an extensive range of tools that helps the technical analyst in reaching the right conclusions. It is our strong conviction therefor that our work is based on a solid background of well researched and evaluated methods and techniques.

Our research has shown us that this approach may just as well be applied to non-securitized commodities and intermediate substances, and even to macro economic and other data series. One important condition that has to be met though is that prices need to be established in a free market. Government interference, or monopolistic or even oligopolistic market structures are warning signs not to apply these methods.

What makes us unique is that we are the only ones making this sort of analysis for non-securitized commodities, quickly, conscientiously, and affordably. In addition we have an extensive experience in competitive intelligence projects, gained in more than 15 years of working in this area. Because of this we are able to assess markets and raw material prices from a perspective of both fundamental analysis as well as from technical analysis.