Since 2020, commodity risk management has been stress-tested in ways that no textbook, no training program, and no amount of historical backtesting could have prepared us for. What we have lived through is not a single disruption — it is a continuous series of shocks, each one capable of rewriting the rules on its own. We experienced them all, back to back, sometimes overlapping.

The results tell the story: more than $300 million in market outperformance. Ninety-eight percent of market decline captured last year. Eighty-five percent over two years. More than $30 million ahead of market this year alone. But those numbers, impressive as they are, do not capture what it actually took to get here.

Six Black Swans in Six Years

It started with the Midwest Derecho of 2020 — a massive inland windstorm that flattened crops across the heart of the Corn Belt. Markets spiked. Basis went haywire. Supply projections had to be rebuilt from scratch almost overnight.

Then COVID-19 hit, and everything changed. Demand patterns inverted. Logistics networks seized up. Markets whipsawed between panic and recovery, sometimes within the same week. Managing commodity exposure during the pandemic was like trying to navigate by the stars while the sky was spinning.

The Russia-Ukraine war brought a new dimension of volatility. Wheat, corn, sunflower oil, energy — entire commodity complexes repriced in days. Geopolitical risk, which many organizations treated as a theoretical exercise, became the dominant driver of real financial outcomes.

Late-season droughts compounded the pressure, squeezing supply at exactly the wrong moments. Tariff wars added layers of uncertainty to already fragile trade flows. And the Iran geopolitical shock introduced yet another variable into an already overloaded equation.

Any one of these events, in isolation, would have been the defining market story of a normal year. We got all six in rapid succession.

No Perfect Strategy

Here is something that does not get said enough in this industry: no risk manager has a perfect year. Not one. Anyone who claims otherwise is either lying or not managing enough exposure to matter.

I watched nearly $50 million in potential deflation evaporate in a matter of weeks. Positions that looked brilliant became burdens. Strategies that had been validated through months of analysis simply stopped working as the market shifted underneath them.

That experience forced me to do something that goes against every instinct a risk manager has — I completely dismantled my own decision-making process. Tore it apart, piece by piece, and examined every assumption, every signal, every habit. It was uncomfortable. It was humbling. And it was the single most valuable thing I have ever done for my practice.

The willingness to tear apart your own strategy, especially one that has been working, is the real edge in this business. Most people double down on what got them here. The ones who outperform over long periods are the ones willing to question everything, including their own success.

Validation That Mattered

After rebuilding the framework, I benchmarked it against every supplier trading KC and Chicago wheat — a broad, competitive field. The result: ranked second overall, behind only a forty-year veteran wheat trader. Someone with four decades of market intuition and pattern recognition, and we were right there.

The framework worked. But more importantly, the benchmarking revealed where refinement could unlock even more. Knowing you are good is useful. Knowing exactly where you are leaving value on the table is transformative.

The Rebuild: From Experience to Evidence

The rebuild centered on one fundamental shift: moving from experience-driven decision-making to data-validated decision-making. That does not mean abandoning experience — far from it. It means subjecting experience to rigorous testing and letting the data tell you which instincts are right and which ones are just comfortable.

We used analytics to isolate the technical indicators that actually predicted market moves versus the ones that just felt like they should. The results were surprising. Some of the signals I had relied on for years turned out to be noise. Others that I had dismissed as secondary turned out to be among the most reliable predictors we had.

The rebuilt framework followed a simple hierarchy: isolate what matters, follow fundamentals, optimize exposure, and trust the model — even when decades of experience are screaming at you to do something different.

That last part is the hardest. Trusting a data-driven framework when your gut says otherwise requires a kind of intellectual discipline that does not come naturally. But the track record does not lie. The model, refined through cycles of real volatility, outperforms instinct alone.

The Invisible Edge: Patience

If there is one lesson from these six years that I wish more people understood, it is the value of patience in commodity risk management.

During market chaos — when prices are spiking, when headlines are alarming, when CEOs and CFOs are calling with urgent directives to add coverage — every instinct says to act. Buy now. Lock it in. Protect the position.

Often, the right decision is the opposite. Wait. Let the market overshoot. Walk it down. Do not chase the spike.

Half the value we created came from the discipline of doing nothing when everyone else was panicking. Strategic restraint does not show up on a P&L line item. There is no budget category for “value created by not making a bad decision under pressure.” But it is real, and it is enormous.

The ability to sit still while the world is moving is not passivity. It is one of the most active, deliberate choices a risk manager can make. It requires conviction in your framework, confidence in your analysis, and the emotional discipline to resist the herd.

The Real Measure of a Risk Manager

Anyone can look like a hero in a rising market. When prices are climbing and you are long, the coverage looks brilliant. Every meeting is congratulations and backslaps.

The real test is the falling market. When prices drop, when the coverage you put on is suddenly above market, when the CFO starts asking why you bought when you did — that is when risk management actually matters.

The question every organization should be asking is simple: what percentage of market decline did your risk manager capture? Not how did they do when markets went up. How did they do when markets went down?

That single metric — percent of decline captured — tells you more about the quality of your risk management than any other number. It separates the lucky from the skilled, the reactive from the strategic, and the adequate from the exceptional.

After six black swans in six years, ninety-eight percent of last year’s decline captured, and more than $300 million in cumulative outperformance, I can say this with confidence: the framework works. Not because it is perfect — it is not. But because it was built to be rebuilt. Stress-tested, broken, rebuilt, refined, and stress-tested again. That cycle, repeated through the most volatile period in modern commodity markets, is what creates real, sustainable edge.